explain the various causes of business risk
Answers
Answer:
Business risk is the possibilities a company will have lower than anticipated profits or experience a loss rather than taking a profit. Business risk is influenced by numerous factors, including sales volume, per-unit price, input costs, competition, and the overall economic climate and government regulations.
Answer:
1. Analyze the sources that may trigger problems
It is important to identify and analyze the sources that can cause a problem. Risk triggers can be internal or external.
2. Act now
Managers shouldn’t wait for potential problems to become actual problems before they start doing something. The moment a problem is deemed to be a threat, it should immediately be dealt with by the company’s executives by devising a plan of action in the event that the risk becomes an actual full-blown concern facing the company.
3. Involve employees
Identifying risks is not the sole responsibility of the managers and top-ranking officials. Management should involve their employees in identifying the risks that they see in their respective departments and train them to handle such risks at their level.
4. Make a list of industry-specific risks
By looking into the industry where the company operates, managers will be able to identify the possible risks that the business may face. If the same risks happen to other companies in the same industry, there is a likely chance that it will happen to your company as well. Therefore, businesses should be ready with a list of solutions or steps to address the risks.
Explanation:
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