Signal · Cost

Supplier concentration

Top-supplier share of total supplier spend — mirror of concentration risk on the cost side of the book.

Cost

What the signal measures

Top-supplier share of total supplier spend — mirror of concentration risk on the cost side of the book.

Why it matters

If your top supplier is 40% of your total supplier spend, a price hike or service outage on their side is a business-continuity event. This is the cost-side mirror of concentration risk — same bus-factor argument, applied to your suppliers. It is worth knowing before your top supplier is acquired, sunset, or repriced.

How to act on it

The drafted action is a resilience prompt — either qualify a second supplier for the critical line now (before you need one) or negotiate a written multi-year lock on price and continuity. Neither move needs to be aggressive; both are cheap insurance if you never activate them.

Worked example — fixture consultancy

On the fixture, the office rent and the largest recurring SaaS subscriptions dominate the supplier spend. Compass reports the top-1 and top-3 share of cost and pairs the number with a short "who depends on this" prompt.