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How Major Customer Changes Affect You If a big customer announces a restructuring, you could be in for a major hit, so have a strategy in place to stay in the game.

By Chris Penttila

Opinions expressed by Entrepreneur contributors are their own.

Anupam Gupta was shocked a few years ago when a large telecom client that contracted his company to handle its marketing databases decided to relocate its marketing department from New York City to Dallas.

Gupta, founder of Avenues International, a Parsippany, New Jersey, data warehousing firm, called his contacts at the company. He even offered to relocate a few employees to Texas to keep projects on track. His contact said they'd look into it. But a week later, Gupta, 41, received a letter in the mail. "They closed our contract immediately," he says. "And we had worked [together] for six years." It meant a 20 percent revenue loss for Avenues International in 2003.

Today, a growing number of entrepreneurs are being blindsided by large customers' restructuring decisions. ConAgra, Die-bold, Sprint, US Airways and Winn-Dixie are just a handful of companies that have undertaken major restructurings. Even IBM recently announced it will restructure and eliminate up to 13,000 jobs. In 2004, 90 companies with over $48 billion in total assets declared bankruptcy, according to New Generation Research, a Boston research firm that tracks bankruptcy data.

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