# Client concentration in gross profit

A term used when buying staffing agency.

The share of GROSS PROFIT one client produces, which is never the revenue share.

Staffing revenue is mostly pass-through wages, so a client that is a quarter of revenue can be half of the margin or almost none of it depending on the spread it carries. Measuring concentration on revenue therefore understates the risk on high-spread accounts and overstates it on low ones. Rebuild the top ten clients by gross profit before pricing the book, because that ranking is usually not the one the seller presents.

Part of: Buying a Staffing Agency (https://searchspheresource.com/guides/buying-a-staffing-agency)

Source: https://searchspheresource.com/guides/buying-a-staffing-agency/terms/client-concentration-in-gross-profit
Not dated: The same editorial definitions as the glossary, inside a trade.

Site index for machines: https://searchspheresource.com/llms.txt