What should I know about a window cleaning company’s reliance on one big customer?
Find out what share of revenue the big customer provides, how long they have stayed and what the contract says. Ask who owns the relationship and whether it survives a sale. If one customer could end the business’s profit by leaving, treat that as a central risk in your decision.
Begin with the facts. Ask for several years of revenue by customer and see how the big account has grown or shrunk. Then request the contract or, if there is none, a plain description of how the work is ordered and paid. Check the length, renewal terms, how either side can end it and whether prices are fixed.
Next, look at the relationship. Who deals with the customer’s building manager, and does that person trust the company or the owner personally? Ask to meet them before closing, if the seller agrees. Find out whether the customer has ever put the work out to tender or complained, since either suggests how secure the account is.
Think about resilience. How much of the crew’s time and equipment is tied to this account, and could the business keep its team busy if it left? Ask what the seller has done to find other clients. A buyer can respond by asking for a transition period, a staged payment tied to keeping the customer, or a smaller risk elsewhere. Your lawyer can advise on how to structure it. Ask how the company would redeploy its crew if the account ended, because idle labour is where the loss shows first.
Key takeaways
- Check revenue by customer across several years.
- Read the contract and meet the customer’s decision-maker if the seller allows.
- Ask your lawyer about terms that protect you if the customer leaves.
- Ask how the crew would be redeployed if the account ended.
Related reading
15 pages on the same subject, grouped by topic.
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- Expert answerHow do I keep a cleaning company’s crews and subcontractors after buying it?
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Due diligence
- Expert answerHow do I check a cleaning company’s complaint history before buying?
- Expert answerHow do I check a cleaning company’s pricing against its workload before buying?
- Expert answerHow do I check a residential cleaning company’s recurring bookings before buying?
- Expert answerHow do I check whether a cleaning company’s clients will stay after the sale?
- Expert answerWhat should I ask about a cleaning company’s night-shift crews before buying?
Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentAfter buying a business, what is the next step?
- 03Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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