short note:- Causes of business risk
Answers
Risk in business can be caused by various factors like:
1) Competition in the market: Business is all about selling what you got and if someone else does it better than you, then your business is definitely at risk.
2) Demand of supplies or goods: The goods in a business tend to have their own demands but these demands can easily fluctuate in a long run. These fluctuations in market makes the business at risk.
3) Government policies: Such policies have great impact on the business either directly or indirectly as the government governs everything.
Causes of business risk:
Business risks are risks associated with a business that can hamper the productivity of a business or can at least reduce profit to a huge extent.
According to type of business, there can be huge types of factors. Some common features are noted below.
- The natural disaster can cause a business risk to any type of business like floods, earthquakes, drought, etc.
- Competition between two or more businesses of same types can cause business risk.
- The demand for substance changes over time which also hampers business.
- The use of modern technologies can cause a hamper in mother business.
- Government policies and mismanagement are several of other causes.