[peteboyd]

Number of customers is critical. When web design studios only have a few customers and one makes up a large percentage of revenue (ex: 10% or more), then you are definitely at the clients whim.

However, if an agency has a lot of customers, each with only a percent or less of total revenue, then its a much more stable platform. You can decline representation of certain clients and they do not effect the total revenue.

Of course, a product line might be better. All customers under one pricing model, customization is limited, and it scales easier. Good stuff.

[oliveremberton]

We had a lot of web design customers (about 200) but you can only work on so many projects at a time - we would typically have 30-40 in our pipeline, but only 10 or so would finish each month. And those projects aren't even in size - we'd normally have a couple big ones accounting for over half our income.

So even with 200 customers our income came mostly down to a handful of customers each month.

[peteboyd]

Yeah, it's tough when a few make up a large percent of the business. You definitely have to drop everything to help them. I think our top 50 clients make up 25% of the business. Top 100 about 50% and the other 400 the rest. So we are less beholden to one large client as maintenance, hosting, SEO, PPC, and redesigns help balance all the new projects that we would need to sign.