Question

Choose a locally operated trading or business unit . Find out the kind of risk it faces in business and the way it deals with them.

Answer 1

locally operated businesses undergo  the following risks
Personal liabilityMost of them are not recognize as a separate legal entity, meaning owner bears all the obligations and debts.If the business fails to pay debts, the owner will lose the income but must pay the money owed using business assets.
Perceived Lack of prestigeLocally operated business lacks the prestige of the limited company. Public perception is often smaller, less long standing. Professional credibility hinders individual from performing sole trading.
Negative view of customersMany clients prefer dealing with a limited company, often seen sole traders as a high risk.

These locally operated business unit encounter risk through the following,
⇒Ensure the business is fully insured against any loss
⇒Partner with other traders so that losses are shared equally
⇒Formation of a limited liability company to ensure larger capital are raised, hence business become legal  separate entity from the owners.