Question

Explain the pervasiveness of risks in business. Describe various types of business risks and the steps involved in managing business risk.

Answer 1

Risks are exposure to business limiting the chances of getting a return on investment.The following are examples of risks and how to manage themCompliance RisksAre risks that are associated with the regulations or bureaucratic rules such employee protection bodies like Occupational Safety and health Administration (OSHA).The only solution is to understand their mandates and comply.Strategic RiskResults directly from particular industrial operation at a given moment.For instance emerging technologies that make a product-line obsolete.Solving this kind of risk requires a company to put a measure in place to continually offer feedback so changes will be detected early.Financial RisksIt’s all about money. That is, credit facilities provided to customers. And the debt load of business.Does the business income come from clients who might not be able to pay? If you are operating an international business like the foreign exchange you should take into account interest rates. Operational RisksResults from internal failures. That is, systems fail unexpectedly. Operational risks can also arise from external events like supplier failing to deliver goods.The best solution to this is to ensure the backup plan to be put in place.ReputationLoss of company’s acceptability within its locality. This might result from product failures, negative publicity or lawsuits. The character takes time to build but is lost in a day. In this era of social media, negative feedback from one customer can reduce earning overnight.It’s highly advisable to maintain good customer care at its level best.Environmental RisksThey are the natural disaster like flooding. Preventing their impact on business is through taking up insurance policy.

Answer 2

Let me help you handle this.

One of the qualities of good entrepreneur is the ability to take risks. this is the only way a good businessman should always follow.

The risk of purchasing stock which you are not sure of whom the buyer is among the risks encountered by an entrepreneur.

The risk of the stock going bad the business faces the risk of the stock going bad and getting expired.