Course contents
Practitioner · Course 6: Portfolio Risk and Competitive Positioning · Lesson 2 of 4

Mapping a factory's own customer and market concentration

Level: PractitionerTime: 45 minutesOrder used: A (the T-shirt)Tool: Portfolio risk and positioning tool
For a merchandiser, owner or domestic buyer who wants to see a factory's full concentration picture, across every buyer and every market, not just one buyer at a time. No previous lesson needed. Figures illustrative.
Domestic buyerCedar & Co. (local brand, 12 shops)
FactoryDelta Garments (garment factory)
ProductBasic cotton T-shirt shape, sold in both markets
Illustrative export shareNorthline Apparel: 65% of total revenue
Illustrative domestic shareCedar & Co.: 20% of total revenue
Illustrative other buyers15% of total revenue, spread across several buyers
02Opening

This page teaches how to build a full map of a factory's own customer and market concentration, for anyone at a factory or a buyer who needs the complete picture, not just one buyer's own share

Lesson 6.1 showed how one buyer's own large revenue share, Northline Apparel's illustrative 65% of Delta Garments' total revenue, turns an ordinary buyer decision into a large factory loss. That single number is only part of the picture. A complete concentration map lists every buyer, every market, and every business model behind Delta Garments' total revenue, so an owner, a merchandiser, or even a domestic buyer weighing a bigger order can see the whole shape of the factory's exposure at once, not just the largest piece of it. This lesson mainly teaches the information flow: turning scattered facts about many buyers into one map that shows exactly where a factory's business is concentrated and where it is spread.

03Before you start

What you need, and what this lesson does not cover

You need: lesson 6.1's own single-buyer concentration calculation, and Delta Garments' own illustrative revenue figures for Northline Apparel and Cedar & Co.

By the end of this lesson you can:

  • list every row a complete customer and market concentration map needs;
  • separate a factory's concentration by buyer from its concentration by market;
  • read a completed concentration map to identify which buyers or markets exceed a flagged threshold;
  • explain why a domestic buyer weighing a larger order has a genuine reason to ask about a factory's own concentration;
  • update a concentration map as a factory's own buyer mix changes over time.

Not covered here: positioning a factory against its own real competitors (lesson 6.3), and building a complete portfolio risk and positioning decision tool (lesson 6.4).

04Key terms

Words you will meet in this lesson

TermMeaning
Concentration mapA single document listing every buyer's and every market's own share of a factory's total revenue, so exposure is visible at a glance.
Concentration thresholdA share level, for example half of total revenue, above which a buyer or market is flagged as worth watching closely.
By-buyer viewA concentration map's rows organised by individual buyer, regardless of which market each buyer belongs to.
By-market viewA concentration map's rows organised by market, for example export or domestic, regardless of which buyer sits inside each market.
Open accountA payment method, used in Cedar & Co.'s own domestic purchases from Delta Garments, where the buyer pays a set number of days after delivery rather than in advance.
Standing forecastThe demand estimate an MTS buyer, like Cedar & Co., builds its own regular orders against, rather than placing one order at a time.
05Teaching
The rule

A complete concentration map lists every buyer's own revenue share and every market's own revenue share side by side, so a factory's full exposure is visible in one place, not scattered across separate facts

Lesson 6.1 calculated one number: Northline Apparel's own illustrative 65% share. A useful map does not stop there. It lists every other buyer too, however small, and groups the same revenue a second way, by market, so a reader can see both how concentrated the factory is in one buyer and how concentrated it is in one type of market. A factory can be highly concentrated in one buyer but reasonably spread across markets, or the reverse, and only a complete map, not a single figure, shows which is true.

A complete concentration map: by-buyer view (every buyer's own share) + by-market view (export share + domestic share)
By-buyer viewBy-market viewEach buyer's own share:Northline 65%, Cedar 20%,others 15%.Same revenue by market:export 80%, domestic 20%.
The same total revenue can be grouped two different ways. Neither view alone tells the whole story; a complete map needs both.
What you meet in real life

A concentration map's own shape differs by how many buyers a factory serves, how its markets split, and which business model sits behind each buyer

What can differThe shapes you will meetWhy it matters to you
Number of buyers behind total revenueDelta Garments' own illustrative map lists three groups: Northline Apparel, Cedar & Co., and several smaller buyers combined. A factory serving twenty buyers of similar size produces a very different, flatter map.Fewer, larger buyers concentrate risk in a small number of rows; many similar-sized buyers spread the same total revenue thinner.
Export and domestic mixDelta Garments' illustrative by-market view splits 80% export, 20% domestic. A factory selling only domestically, or only exporting, has a one-sided by-market view with nothing to compare it against.A mixed export-and-domestic map lets a market-specific shock, an export slowdown or a domestic downturn, be weighed against the other market's own share.
Business model behind each buyerNorthline Apparel's own share is MTO, ordered piece by piece; Cedar & Co.'s own share is MTS, built against a standing forecast. A map that only totals revenue misses this difference.An MTO buyer's share can disappear faster than an MTS buyer's share of the same size, since an MTS relationship runs against a standing forecast.
Who asks to see the mapDelta Garments' own owner uses the map to manage risk; a domestic buyer like Cedar & Co., considering a larger order, may reasonably ask to see it too, to judge whether the factory can reliably prioritise a bigger domestic commitment.A concentration map is not only an internal risk tool; a buyer weighing a bigger commitment has a genuine reason to ask a factory about its own concentration.
The case we follow

Cedar & Co. asks to see Delta Garments' own concentration map before committing to a larger standing forecast order

Cedar & Co., Delta Garments' own domestic buyer, is considering roughly doubling its own standing forecast order for next year, paid on the same 60-day open account terms it already uses. Before committing, Cedar & Co.'s owner, Omar, asks Mona, Delta Garments' merchandiser, for a picture of the factory's own concentration, not because Cedar & Co. doubts Delta Garments' quality, but because Omar wants reassurance that Delta Garments is not so dependent on one export buyer that a domestic partner's own growing order could be squeezed for capacity later. Mona builds the map both ways, by buyer and by market, to answer the question directly.

The worked number

Delta Garments' own concentration map shows Northline Apparel above the flagged threshold on the by-buyer view, while the by-market view shows an 80/20 export-to-domestic split

By-buyer view: Northline Apparel 65%, Cedar & Co. 20%, other buyers combined 15% (total 100%)
By-market view: export (Northline Apparel + other export buyers) 80%, domestic (Cedar & Co. + other domestic) 20%
Flagged threshold used in this map: any single buyer above 50% of total revenue
By buyer (Northline above threshold)By marketNorthline Apparel, 65%Cedar 20%Others 15%Export, 80%20%
One buyer already crosses the flagged threshold; no single market does. Northline Apparel's 65% share alone exceeds the 50% flag, while the export/domestic split of 80/20 is one-sided but not itself a single point of failure the way one buyer's share is.
The method

Build a complete concentration map for any factory in five steps

  1. List every buyer contributing to total revenue, however small, and calculate each one's own revenue share.
  2. Group the same total revenue a second way, by market (export, domestic, or further split if useful).
  3. Note each buyer's own business model (MTO, MTS or hybrid) alongside its share.
  4. Flag any buyer or market above an agreed threshold, for example half of total revenue.
  5. Update the map whenever a buyer's own order volume changes meaningfully, not only once a year.
The trap

A common mistake is building a concentration map around only the largest buyer, and treating every smaller buyer as too small to matter

A factory that maps only Northline Apparel's own 65% share has answered an important question, but not the full one. Cedar & Co.'s own 20% share is itself large enough to matter if it were lost, and the remaining 15% spread across several smaller buyers is not risk-free either, since several of those buyers together could still represent a meaningful loss if several left at once for related reasons, for example a shared downturn in one export region. A map that stops at the largest row gives a false sense that everything smaller is safe by comparison, when the real test is whether each row, and each market, is sized in a way the factory could actually absorb losing.

06In plain words

Knowing that one buyer is large is useful, but it is not the whole picture. A full concentration map lists every buyer, however small, and shows what share of the factory's total business each one represents. It also groups the same business a second way, by market, export against domestic, so a slowdown specific to one country or one type of buyer can be weighed on its own. Cedar & Co., a domestic buyer thinking about placing a much bigger order, has a real reason to ask to see this map too, not because it doubts Delta Garments, but because it wants to know whether the factory's capacity is already stretched thin by one very large export buyer. A complete map answers that question honestly, buyer by buyer and market by market.

07Quick check
  • A concentration map needs a by-buyer view and a by-market view; neither alone is complete.
  • A flagged threshold, for example 50% of total revenue, marks a buyer or market worth watching closely.
  • A buyer's own business model, MTO, MTS or hybrid, changes how fast its share could disappear.
  • A domestic buyer considering a larger order has a genuine reason to ask about a factory's own concentration.
  • Several smaller buyers combined are not automatically safe; they can still represent a meaningful shared loss.
  • Update a concentration map whenever a buyer's own order volume changes meaningfully.
08Workplace scenario

Cedar & Co.'s owner asks Delta Garments' merchandiser for a concentration map before doubling his own standing order

Omar, the owner of Cedar & Co., tells Mona he is considering roughly doubling his own standing forecast order with Delta Garments next year. Before committing, he asks a direct question: "If I double my order, will my own business actually get the capacity it needs, or is most of your factory already spoken for by one buyer?"

Here is the map Mona shares with Omar:

Delta Garments, concentration map shared with Cedar & Co. By buyer: Northline Apparel 65%, Cedar & Co. 20%, other buyers 15%. By market: export 80%, domestic 20%. Flagged threshold: any single buyer above 50%.

Should Omar read this map as a reason to hold back on the larger order, or as useful information that still supports going ahead? Decide before opening the answer.

Show decision

The map is a reason for Omar to ask Delta Garments a further, specific question about capacity planning, not a reason to cancel the larger order outright. Two facts decide this together.

First, Northline Apparel's own 65% share is well above the flagged threshold, confirming Omar's instinct that Delta Garments is heavily weighted toward one export buyer. This is real information Omar did not have before, and it is reasonable for him to ask how Delta Garments plans to protect his own growing order's capacity if Northline Apparel's own volume stays high.

Second, the map does not show Cedar & Co.'s own order being squeezed today; it shows a structural concentration that could, in future, create pressure. Doubling the order does not by itself become unsafe because of this map; it becomes a decision Omar should make with the map's own facts in hand, alongside a direct conversation about how Delta Garments would prioritise capacity between its two largest buyers.

The map's value is turning a vague worry into a specific, answerable question, not producing an automatic yes or no on its own.

09What it costs

Building and maintaining a concentration map costs a merchandiser's own time, a small cost against the loss it can help a factory or a buyer avoid

Framed against lesson 6.1's own worked figure, an unmapped, 65%-concentrated factory risks losing 19.5% of total revenue to a single buyer's ordinary decision; the map itself costs only the time to build and update it.

Illustrative time to build a first concentration map: 2 hours of a merchandiser's own time
Illustrative time to update it each quarter: 30 minutes
Illustrative revenue at risk this map exists to surface (lesson 6.1's own figure): 195,000 local-currency-equivalent, per an adverse 30% cut on a 65% buyer

A concentration map's own cost is small and recurring; the exposure it reveals, left unmapped, is large and sudden.

10Working template

Portfolio risk and positioning tool: build the by-buyer and by-market views on one sheet

Open the Portfolio risk and positioning tool workbook linked below. Its "Customer concentration" sheet lists every buyer, its illustrative share, its business model, and its market, then flags any row above the threshold you set, the same map this lesson built for Delta Garments. Fill in the yellow "Your factory" column with your own buyers for practice.

[Download the Portfolio risk and positioning tool](../../templates/T16-C06-portfolio-risk-positioning.xlsx)

Download the Portfolio risk and positioning tool (Excel)

11Check yourself

1. Why does a complete concentration map need both a by-buyer view and a by-market view, rather than just the largest buyer's own share?

2. Why does Cedar & Co.'s owner have a genuine reason to ask to see Delta Garments' own concentration map before doubling his order?

3. A different factory's map shows Buyer X at 45%, Buyer Y at 30%, and eight smaller buyers sharing the remaining 25%. Using a 50% single-buyer threshold, what does this map show?

12Glossary
ENARFRTRMeaning
Concentration mapخريطة التركّزCarte de concentrationYoğunlaşma haritasıA single document listing every buyer's and every market's own share of a factory's total revenue, so exposure is visible at a glance.
Concentration thresholdعتبة التركّزSeuil de concentrationYoğunlaşma eşiğiA share level, for example half of total revenue, above which a buyer or market is flagged as worth watching closely.
By-buyer viewالعرض حسب المشتريVue par acheteurAlıcıya göre görünümA concentration map's rows organised by individual buyer, regardless of which market each buyer belongs to.
By-market viewالعرض حسب السوقVue par marchéPazara göre görünümA concentration map's rows organised by market, for example export or domestic, regardless of which buyer sits inside each market.
Open accountحساب مفتوحCompte ouvertAçık hesapA payment method, used in Cedar & Co.'s own domestic purchases from Delta Garments, where the buyer pays a set number of days after delivery rather than in advance.
Standing forecastتوقعات ثابتةPrévision permanenteSürekli tahminThe demand estimate an MTS buyer, like Cedar & Co., builds its own regular orders against, rather than placing one order at a time.
13Next

Lesson 6.3: Positioning a factory against its own real competitors

You now know how to map exactly how concentrated a factory's own business is, across buyers and across markets. The next lesson teaches how to position that same factory against its own real competitors, using price, lead time and reliability. Back to the course map

14Ladder

RecognizeList the rows a complete customer and market concentration map needs.
ConnectSee how a by-buyer view and a by-market view can each hide what the other reveals.
CompareTell a factory concentrated in one buyer from one concentrated in one market.
DecideJudge what a concentration map should change about a buyer's own decision to place a larger order.