8K – The Switzerland Structure
Week 3 of the 8 Key Drivers of Business Value: The Switzerland Structure
A business’ value requires that the business not be overly reliant on any one customer, employee or supplier. This is quite a big subject, so this is just a quick overview. Post a comment if you’d like anything expanded upon.
How can we get more independence?
- With customers, the danger point is around 15% of sales. The simple answer is to get more customers – but it’s never that simple in reality. You can also have a look at any low-margin products you’re selling and dropping them. Scope creep often becomes a factor here.
- For suppliers: Again, getting more when you can is the simple answer. Even if this means that you lose some bulk discounts, it can be worth it. If you really are tied to one supplier, ensure that you have good long-term contracts in place.
- A key employee can be a real risk to a business. Consider ways in which you can cross-train your other employees. Having strong systems in place will also help.
If you want to see more independence in your business, we’ve put together a free training webinar to start you on your journey: