This paper examines how the target's customer concentration affects merger performance. We find that the acquirer purchasing a customer-concentrated firm experiences significantly lower announcement return and worse long-run stock performance. The effect is more pronounced when the customers...

Using a recently expanded data set on supplier-customer links, we introduce a dynamic relationship life-cycle hypothesis. We hypothesize that the relation between customer-base concentration and profitability is significantly negative in the early years of the relationship, but becomes positive...

We examine how suppliers' relationship-specific cost structure decisions affect future performance. We argue that suppliers can avoid risk by choosing more flexible cost structures (less fixed-to-variable costs) or commit resources by choosing more rigid cost structures (more fixed-to-variable...

Customer concentration affects CEO compensation through two possible channels: first, a more concentrated customer base raises firm risk, for which CEO requires higher compensation; second, CEO is likely to hold customer ties, and a more concentrated customer base enables CEO to have more...