LYD IA MART INS ARAH MCALL ISTER STEPHANIE SEDMAK

TYPES OF BUSINESS RISKS

WHY SHOULD BUSINESS BE CONCERNED WITH RISKS

• Risks in a business can lead to the possibility that a company will have lower profits than anticipated or that it will experience a loss rather than a profit. • Business risk is influenced by numerous factors,

including sales volume, per-unit price, input costs, competition, overall economic climate and government regulations.

TYPES OF RISKS

Financial Risk: Direct financial risks have to do with how your business handles money.

Operational Risks :Operational risks result from internal failures

Reputational Risk :Loss of a company’s reputation or community standing might result from product failures

IMPACT ON A PROFIT

Because of the failures or the loses your business experienced, it can lower your profit.

And also due to your lower profit, your business can go out of business if you don’t change your method how your business is doing now.

BUSINESS DECISIONS

• Risks determine how businesses make decisions• Businesses must first determine if risk is an

internal risk or external risk • Internal risk • Events within the organization

• External Risk • Events outside the organization

PROTECTING THE BUSINESS FROM RISK

• Internal Risk • Have adequate record keeping • Update IT systems• Review employees’ performance

• External Risk• Political and Economic (regulations/recessions)• Health and Safety• Environmental risk (natural disasters)

EXAMPLES OF HUMAN RISKS

• Shoplifting • Employee theft• Burglary• Robbery• Computer Crime• Stolen credit cards and bad checks• Accidents and injury