Understand your volume of transactions and how much of those transactions are on terms.
If you have only a few clients, and all are on terms, one default could devastate your business. If you have a lot of clients, and only 1 defaults, while you might be hurt financially, it could be survivable. Understand the dynamics of your client base, how many are on terms, and how long those terms are. It is imperative to spread the risk as thinly as possible to be able to adequately survive a potential default.
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