Sadly, some businesses might close altogether as a result of the pandemic and jobs will be lost no matter how hard businesses try to keep afloat.
From airlines to mom and pop coffee shops, businesses large and small have been significantly impacted by COVID-19. But if you lose your largest client, do you have a plan in place to mitigate the loss and rebuild?
West Chester, PC-based online invoicing platform Skynova asked 1,011 business owners and decision-makers on the impact the COVID-19 pandemic has had on client retentions. It wanted to know how many lost their largest client, and what businesses are doing after these losses to survive.
Furthermore, businesses who reported losing their biggest client have had to let go of an average of 13 employees. On average, business decision-makers indicated losing three clients each, and almost eight in ten reported anticipating this loss.
Almost 14% of business decision-makers said the loss of revenue was between 50% and 59%, and more than 1 in 5 respondents indicated forfeiting between 60% and 79% of their overall revenue due to losing their biggest client.
Smaller businesses seemed to fare better if they experienced a loss. Micro-businesses (1 to 9 employees) reported the lowest loss to overall revenue after losing their biggest client (42%), whereas medium size businesses with 50 to 249 employees reported the highest revenue loss (51%)
Half of business decision-makers (50%) indicated losing their largest client as a result of the pandemic, and 46% reported their client lost funding.
Other reasons businesses reported having lost their biggest clients were: a change of direction or goals (36%), change in leadership (32%), and failed business models (27%).
The survey also showed that businesses have tried several ways to retain their largest client. Half of businesses reported offering a discount (50%), offering to do more work (42%), and renegotiating terms to benefit the client more (40%).
Only one in three (34%) actually met with the client in person to try and persuade the client to stay.
However, looking forward, 91% of business owners have a plan prepared to rebuild their business and 53% felt that losing their biggest client was a temporary setback.
Over four in five (85%) of businesses said that they are confident that they can bounce back from losing their largest client.
The research provides some insights for businesses. Most businesses believed they would survive the COVID-19 setback, and almost all had plans for rebuilding.
From finding new opportunities, focusing on client satisfaction and boosting their marketing presence, businesses said that they were taking immediate action to mitigate the loss of their biggest clients.
As the vaccine rollout continues and work life gets back to normal, hopefully businesses will realise that they managed to survive 2020's downturn, and can make plans for rebuilding their businesses in 2021 – with or without their largest clients.