The Concentration Risk Audit and Diversification Sprint Board

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Measure your concentration, then spend ninety days bringing it down.

The working companion to The Concentration Risk Playbook. The playbook explains why concentration ends shops. This is where you measure yours and start diluting it.

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Get your own copy

On a phone or computer: make your own copy in Google Sheets. It opens a fresh, editable copy in your own Google Drive.
No Google account? Download it for Excel and open it in Excel or any spreadsheet app.
On paper: print this page or save it as a PDF and work by hand.

Your shares, your zone, the swing test and the cash math fill in for you. Fill the table, tick the boxes, and the page becomes the record of what you actually did.

Read the playbook first if you have not. Part 1 will make sense cold. Part 3 will not.

Want the quick reading first? The Concentration Risk Self-Audit runs the share and the swing test in a few minutes. If one owner or channel hides under several building types, the Vertical and Channel Concentration Audit will find it.

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Part 1. Measure it

Pull your last twelve months of revenue and break it into sources. A source is anything that could make one decision and change your year: a carrier, a third-party administrator (TPA) or program, a referral partner, a single large commercial account, a franchise or lead vendor.

Two rules for the list, or the arithmetic will not tie:

Every dollar lands in exactly one row. No job counted twice, none left out. When a job came through a TPA on behalf of a carrier, put it under whoever controls the routing, because that is the party who can switch it off.
Everything small goes in one row. Anything under about 3 percent of revenue goes into the "All other sources" row. You only need the big exposures here.

Total revenue, last 12 months (dollars):

Now fill the table. Percent share is that row's dollars divided by your total revenue, times 100. Zone comes from the band table underneath.

Revenue source	$ revenue, last 12 months	% share of total revenue	Zone
1.
2.
3.
4.
5.
6.
7.
8.
All other sources (each under about 3%)			n/a
Total	must equal your total revenue above	100%	your zone is the worst zone in any single row

If the dollar column does not add to your total revenue, something is double counted or missing. Fix it before you read the zone, because a wrong denominator makes every share on the page wrong.

Field	Your entry
My single largest source
Its share of total revenue (percent)
My zone

Write that share down. In our experience, owners who guess it before they run it usually guess low.

The bands

Zone	Share from one source	What it means on a Tuesday
Healthy	Largest single customer, carrier, TPA, or program at or under 10%	Well diversified. If one source drops out, it hurts, but it will not sink you.
Caution	One source above 10%, up to and including 25%	That source can dictate terms to you. A rate cut alone will damage your net margin.
Danger	One source above 25%	You do not own your business. You are one outside decision away from insolvency.

How the boundaries work. Shares are counted at the parent company. A share at or under 10% is Healthy, above 10% and up to 25% is Caution, and above 25% is Danger. So exactly 10% reads Healthy and exactly 25% reads Caution, and every share from 0% to 100% falls in exactly one zone.