Meaning of Risk Analysis
Every project has the risk to fail when we try to buy or make it. So, it is better to evaluate it by identify different risks if we will involve in same project of business. These list and assessments of all risks will be called risk analysis. For example, A project has 5 types of risks. Further in risk analysis, we have checked all the level of 5 types of risks. Now, all these risk analysis will help to take action to control all these risks by taking steps.
Following are the main risks of any type of business
1. Risk of Business Security
Every type big business has the risk of its security. In this security, its physical property security risk and online security risks from hackers.
2. Competition
When a project of business is growing, more people wants to gain from it because its boom become risk for its growth. With this, you will unable to reach goal because competitor may start to play game of cheap prices with decreasing quality of same product. At that time, you have to more careful from competitor.
3. Trade Mark and patents and Copyright Risks
People uses the trade marks and patents and break copyright. With this, business may suffer losses. One of example of latest movie whose pirated copy can come in the market and movie business can face loss from it.
4. Strikes
Strikes are the main business risk. With this, our production will unable to fulfill the consumer demand and we may loss the sale and profit. Main reason of not good relationship between employers and employees. Employees may demand more salary or wages or other demands and if employer will not do same, employees may go to strikes and business has risk to loss.
5. Changing of Trend and Fashion
Time to time, customer's fashion has changed. Now, no people are using hand watch due to mobile and touch phone. With this watch business are suffering losses from this new trend and fashion. If you are doing any business, you may also risk of trend and fashion. Yes, you can manage this risk by flowing in the flow of water not against the water. For example, past my internet providing company was in telephone business. But after changing trend, it started wire broadband. Again trend has changed. People demand more speed. So, it has taken new technology of fibe broadband.
Risk Assessment
Second part of Risk Analysis is risk asssessment. In this part, we will see the negative impact on the future of our asset or business. Also we try to apply risk management strategy to control all these risks.
Reference eBook
Financial Management eBook
Reference Notes
M.com Financial Management Notes
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