There is no fixed formula, but concentration above roughly 25 percent in a single customer draws attention, and above 40 percent it materially changes both the multiple and the deal structure.
More detail
Buyers respond to concentration in three ways, often at once: a lower multiple, a larger portion of the price in an earnout or seller note, and a longer transition commitment from the seller. What moves the analysis is the quality of the relationship rather than the percentage alone. A customer relationship that is 35 percent of revenue, twenty years old, sole-sourced on parts the customer has qualified, and held at multiple levels of both organizations is a different risk from a 35 percent customer won last year on price. Documentation helps: contracts, order history by part, qualification records, and relationship maps showing more than one point of contact. Reducing concentration takes years, so for most owners the realistic path is documenting durability rather than fixing the number.