Revenue concentration calculator

How much of my income depends on a single crop, activity or customer?

Worked out from each source’s share of revenue, read as an effective number of sources.

CurrencyWrite the name or symbol of your currency. It only shows up on labels; no arithmetic depends on it.

Period this count coversTwelve closed months, the same ones for every source. Example: January to December of last year.

Common revenue sources (tap to add; the amount is yours):

Your revenue sources

Revenue source. The name you use for this line of money coming in. Example: soybeans, finished cattle, milk, land rent.

What it brought in. Gross revenue from that source in the period, with returns and discounts already taken off. Example: 480,000.

What makes this source rise and fall. Optional. Write a short name, not a sentence: two sources only fall together when they get the same word, spelled the same. The count is then redone with them added up. Leaving it blank says nothing else moves with this one. Example: grain, livestock, the same buyer.

The math runs in your browser. We do not send or store anything you type.

Your result

Write down each revenue source with what it brought in over the period to see the effective number of sources, the share of each one and the band. Fill in what makes each source rise and fall and the second reading, by group, appears.

Take your revenue mix in writing

The report carries your sources ranked with share and running total, the groups with the sources inside each one, both readings side by side, the calculation trail step by step and the note on what the index does not measure, in a document you can print and take to the table where the call gets made.

ArticleHow many sources does your revenue really lean on?The effective number of sources step by step, with the same worked example as this tool, to the number. It shows why the band cuts sit where they sit, why a trade yardstick lies about a farm, and what to actually do when the number comes out bad.Read the full article

Revenue mix

Your inputs

Your result

Calculation trail

Your sources

Your sources from largest to smallest. The running total column answers how many of them you have to add up to reach half and three quarters of the revenue.

The two readings

This number separates the concentration that comes from having few sources from the concentration that comes from one of them weighing too much. With the sources you have all equal it would read 0%, and with everything in one source it would read 100%.

What these numbers say

The effective number of sources is 1 divided by the sum of the squared shares, and it says how many equal sources would give the same concentration your list gives. The diversification index is the complement of that sum, on a 0 to 1 scale. The reading by group is the same arithmetic once the sources you declared as falling together are added up, and the difference between the two is what the list of sources was hiding. The bands are farm bands, not market bands.

Understand the method in full

The full article shows why the band cuts sit where they sit, why a trade yardstick lies about a farm, and what to actually do when the number comes out bad.

Read the full article

How to read it

This number measures share, and only share. It does not know whether two of your sources rise and fall together, it does not know which of them leaves a margin once the cost is paid, and it does not know what next year holds: it describes the twelve months you typed in. The bands here are farm bands, not market bands: with four equal sources the sum of the squared shares comes out at 0.25, which is the best a farm with four sources can do, and a trade yardstick would still read that as moderate concentration: on that ruler a farm needs seven sources of equal weight before it counts as well diversified. If you fill in the group field, the second reading fixes the first of those blind spots, and it is worth exactly what your grouping is worth.

The sources

The effective number of sources says how many equal sources would give the same concentration your revenue has today. List every line of money that came in last year with what it brought, write down what makes each one rise and fall, and see each source’s share, the diversification index, and how much of that support disappears once the sources that fall together are added up.

A farm with a million across five lines, 480,000 from soybeans down to 40,000 from rented pasture, comes out at an effective 3.2 sources and a diversification index of 0.68: fewer than the five it lists, because one line carries most of the weight.

The effective number is the concentration measure the OECD uses in its farm-level analysis of risk, read as sources instead of as a share, and the tool also asks what makes each line rise and fall, because two sources that fall in the same bad year count as closer to one than to two.