Brillian asks whether your business relies heavily on one customer, supplier, or piece of technology. Here's why that matters for your valuation.

Concentration risk exists when a large share of your revenue, supply chain, or infrastructure depends on a single relationship — one big customer, one key supplier, or one critical piece of technology.

Buyers see concentrated relationships as fragile: losing that one customer or supplier could have an outsized impact on revenue and earnings. All else equal, businesses with concentrated risk are typically valued at a lower multiple than those with a diversified base.

Answer honestly — this includes your largest customer, a key supplier, or a single point of technology dependence. Disclosing a known risk doesn't automatically hurt your valuation; an undisclosed risk that surfaces later, during an actual sale, is far more damaging to a deal than one that's known and understood upfront.

Diversifying your customer or supplier base is the most direct way to reduce this kind of risk — though it's not something you need to solve immediately. Knowing where your concentration risk sits today gives you the runway to diversify before it becomes a critical issue in a future sale.