Tool

Vendor Concentration Risk Score

Eight questions that measure how much of your operation depends on a single vendor, and how expensive that dependency would be to unwind if you ever had to.

Score one vendor relationship at a time: the one your renewal, incident or budget review has put in front of you. Fixed points, the same result every time, nothing stored.

Last reviewed 3 July 2026 · Free and ungated

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Selected senior operators who have negotiated both sides of deep vendor relationships can review your exposure confidentially before the renewal.

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How a client brief works · What you receive

Fixed questions · no AI · nothing stored

Run the scorecard

Answer for one specific vendor relationship as it stands today, not as the contract describes it.

0–34 Diversified 35–64 Concentrated 65–100 Critical dependency How our tools are scored
  1. Share of critical process What actually stops if this vendor stops?
    • The vendor supports a peripheral activity
    • Important to one core process, with workarounds
    • A core process stops if this vendor stops
  2. Switching cost How long and how expensive would replacement be?
    • Replacement would be measured in weeks
    • Months of effort and management attention
    • A year or more, or a full re-implementation
  3. Contract terms at renewal What stops the vendor repricing you at the next renewal?
    • Renewal pricing and terms are contractually capped
    • Some protections, with room for escalation
    • The vendor can reprice at renewal knowing you cannot leave
  4. Data portability Could you take your data out tomorrow, in usable form?
    • Data can be extracted in usable form on demand
    • Extraction is possible, with cost and format caveats
    • Data is effectively locked into the vendor's formats
  5. Vendor financial visibility Would you see trouble at this vendor before it reached you?
    • Financial health is visible and monitored
    • Some visibility, reviewed occasionally
    • No real insight into whether the vendor is viable
  6. Alternative availability If you had to move, where would you go?
    • Several credible alternatives exist at comparable cost
    • Alternatives exist, with meaningful migration barriers
    • No credible alternative at acceptable cost
  7. Exit plan Does a real exit plan exist, and has it been tested?
    • A tested exit plan exists and is maintained
    • An exit plan exists on paper, untested
    • No exit plan beyond hoping it never matters
  8. Past dependency incidents Has this relationship already shown you its teeth?
    • No outages, disputes or surprises of note
    • Occasional issues, absorbed without lasting damage
    • Incidents have already shown how exposed you are
Reading the score

What the result bands mean

0–34: Diversified

On these answers the relationship is healthy dependency rather than exposure: alternatives exist, data is portable and the vendor cannot reprice you against a wall. Positions like this are usually inherited rather than designed, which means they can erode without anyone deciding anything.

35–64: Concentrated

Real dependency has formed: the vendor sits inside a core process, switching would cost months, and some contractual protections have not kept pace with how embedded the relationship became. Nothing about this is unusual, which is exactly the problem. Concentration at this level is normal right up until the renewal, the price rise or the outage.

65–100: Critical dependency

This vendor can now materially affect your operations, your costs or both, and knows it. At this level the relationship has outgrown procurement and belongs on the risk register, alongside the other things that could stop the organisation.

How concentration builds without a decision

No one signs a contract titled critical dependency. Concentration accretes: a module added because integration was easy, a second process migrated during a cost review, a renewal extended for a discount. Each step is locally rational, and the sum is a vendor no one chose to depend on. The score exists to see the sum, because the organisation only ever saw the steps.

The renewal is the exam

A vendor relationship reveals its true balance of power at renewal. If the vendor knows you cannot leave, the negotiation is a formality with meetings attached. The paradox of exit planning is that its value peaks when it is never used: a tested exit path changes renewal pricing even if you stay for a decade.

Who should score it

  • Procurement leaders reviewing the vendor portfolio for exposure rather than spend.
  • CIOs and COOs whose critical processes have gradually consolidated onto fewer platforms.
  • CFOs testing what an unplanned vendor exit would actually cost the organisation.

Reading the result

Eight answers at 0, 5 or 10 points, normalised to 100, where higher means deeper dependency. Score your top vendors annually and watch the movement: a rising score across renewals is the clearest early warning this tool produces, and it is invisible in any single year's snapshot.

Frequently asked questions

Is vendor concentration always bad?

No. Deep partnerships can be efficient, and fragmenting critical processes across many vendors has costs of its own. The problem is unpriced concentration: dependency the organisation never chose, never measured and never bought protections against. The score makes the choice explicit.

Our vendor is a large, stable company. Does dependency still matter?

Stability answers one question out of eight. Large vendors rarely disappear, but they reprice, retire products, change licensing models and get acquired. Financial visibility protects you against failure; the other seven questions protect you against everything else.

We scored critical dependency but switching is genuinely impossible. Now what?

Then the work is to make the dependency safe rather than to end it: contractual protections at renewal, verified data extraction, influence over the vendor's roadmap, and a priced view of what partial alternatives would cost. Captivity you manage is a strategy; captivity you ignore is a countdown.

Your vendor has already scored this relationship. Have you?

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