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Dear respected BCQuestion,
Good day! Thank you for posting to Microsoft Community. We are happy to help you.
As per your description, it seems that your current structure is a main document library with client folders.
While it may be tempting to create a separate document library for each client, this approach could quickly become unmanageable as you may exceed SharePoint's limits on libraries or run into performance issues. Instead, consider creating:
If your projects can be categorized, create separate libraries for each project type. This helps to reduce the number of items in any single library while still allowing easy access.
SharePoint lists and libraries have a threshold limit of 30,000,000 items, but you will encounter significant performance issues once you exceed 5,000 items in a view without proper indexing or filtering. This means that for practical purposes, you should try to keep the number of items in a single view under 5,000. For your reference: SharePoint limits - Service Descriptions
There is no strict maximum on the number of libraries you can create in a SharePoint site; however, performance can degrade when there are too many libraries or when the libraries themselves contain too many items.
Conclusion:
Yes, creating a separate document library for each client can be a good approach. This helps in organizing files, setting unique permissions, and managing metadata more effectively. It also avoids hitting the 5,000-item threshold in a single library.
Please understand that our initial reply may not always immediately resolve the issue. However, with your help and more detailed information, we can work together to find a solution.
Appreciate your patience and understanding and thank you for your time and cooperation.
Sincerely,
Waqas Muhammad