What the share actually measures
It measures dependence. A shop that invoices 40 percent to one OEM has a different buyer conversation than a shop that invoices 8 percent to its largest account. Census CBP 2023 counted 284,452 manufacturing establishments, and 68.4% have fewer than 20 employees (Source: Census CBP). Small shops often have lumpy books. Lumpiness is not a crime. Hiding it is.
Valuation still starts from the cell. Concentration moves you inside the cell. It does not invent a new national multiple.
Switching costs cut both ways. Tooling at the seller, qualifications, and dual-source rules can keep an OEM in place. They can also keep the seller trapped. A certificate that is the only reason the account stayed is concentration plus recert risk. Price both. Do not invent a folklore cutoff. The valuation owner explains how the chip sits inside the cell.
A rising PMI does not diversify a book. A 68.4 percent small-shop census print explains why lumpy books are common. Lumpiness is not a crime. Hiding it after the NDA is. How it works still wants billings by customer. Sell-now versus fix-concentration is the process fork. This page will not pick it.
How is concentration different from backlog?
Backlog is work already sold and not yet shipped. Concentration is who writes the checks. A diversified backlog can still sit with one customer. Sell now versus fix concentration first is the process choice. This glossary entry will not pick it for you.
A diversified backlog can still sit with one customer. Pipeline is not backlog. A certificate that is the only reason the OEM stayed is concentration plus recert risk. Price both. Do not invent a kill-percent. Buyers price the risk inside the size-band times sub-sector cell. Hiding the top-account share after the NDA is a lie. Sell-now versus fix-concentration is the process fork. This page will not pick it and will not invent a year of free growth.
How it works still wants billings by customer. FAQ owns the questions. The concentration owner is the process home. Jason Taken is a business broker.
What a buyer should pull
Twenty-four months of billings by customer, contract terms, and switching costs. ISM’s August 2026 PMI printed 54.6 (Source: Industry Today / ISM). A rising PMI does not diversify a book. BizBuySell’s 2.75x SDE median (Source: BizBuySell) is a Main Street print, not a concentration holiday.
| Noun | Question | Not the same as |
|---|---|---|
| Concentration | Who | Backlog |
| Backlog | What is sold unshipped | Pipeline |
| Certificate | Access gate | Diversification |
Contracts, tooling title, and switching costs decide whether a 40-percent account is a prison or a partnership. A multi-year agreement with cancellation cost is one story. A blanket with at-will releases is another. A certificate that is the only reason the OEM stayed is a third. Price the sales that die if the account dies. Do not invent a kill-percent. Buyers price the risk inside the size-band times sub-sector cell.
A diversified backlog can still sit with one customer. Pipeline is not backlog. A teaser that hides the top-account share until the NDA room is a process choice some sellers make. Hiding it after the NDA is a lie. Sell-now versus fix-concentration-first is the process fork. This glossary entry will not pick it. It will not invent a year of free growth while you add accounts.
How it works still wants billings by customer before anyone quotes. FAQ owns the questions. The glossary hands you to the concentration owner, then to a confidential intro call. Jason Taken is a business broker.
If the top account has not been told about a sale, that is normal. If the top account’s contract can cancel on a change of control, that belongs in the LOI. Concentration without a change-of-control clause is one chip. Concentration with a kill switch is another. Name which you have.
If the top two accounts together write most of the checks, say so as a cluster, not as two small numbers. Buyers add. The CIM should add first.
What this page will not do
It will not publish a kill-percent. Jason Taken is a business broker. The glossary sends you to the owner. After the noun is straight, book a confidential intro call.