CUSTOMER CONCENTRATION VERSUS FRAGMENTATION AND ITS IMPLICATIONS IN CORPORATE RISK

Jorge Mongay Hurtado ()
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Jorge Mongay Hurtado: ESIC Business and Marketing School, Spain

Eurasian Journal of Business and Management, 2018, vol. 6, issue 1, 1-6

Abstract: This research explores on one side, the composition and structure of databases of clients in a total of 204 multi-sectorial companies based in Spain, Thailand and Indonesia. The criterion used to differentiate a customer´s database structure relates to its degree of “fragmentation” versus “concentration”. Also, the research has determined a risk model using a statistical Monte Carlo simulation method in each company. Both, risk levels expressed as certainty to obtain levels of profits and type of customer´s database structure have been analyzed under an Anova test and multiple correlation analysis exploring a total data of N=1020. Results are quite relevant with a conclusion that the volatility of sales affects significantly the changes in the values of certainty of profits, (although not directly to the levels of risk or certainty) related to the achievement of certain results in profits. Consequently, managers should be aware of the importance of a robust quantitative and qualitative accurate sales forecasting method which will contribute with no doubt to decrease corporate risk being extremely helpful when presenting plans or forecasts in front of any kind of stakeholders.

Keywords: Customer´s Database; Risk Analysis; Sensitivity Analysis; Management Strategy (search for similar items in EconPapers)
Date: 2018
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Persistent link: https://EconPapers.repec.org/RePEc:ejn:ejbmjr:v:6:y:2018:i:1:p:1-6

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