Lot of hard work is required for running a successful business. Customers satisfaction must be one’s motto from whom you earn income. There are so many obstacles while doing a business which you must overcome to achieve various objectives you have set says Gaurav Mohindra.
There are many remedial measures to be observed in the business under risk management. Following is the detail of seven types of business risk which must be discussed in detail.
1) Economic Risk:
The economic conditions of the country change from time to time. The demand for the products increases when there are positive changes in the society and vice versa. Therefore, it is necessary to see various trends in the organization and plan accordingly. One must have a lot of savings during the crisis to face different risks in the economy. When there is a downtrend in the business, one must curtail all expenses and avoid overhead costs which should be your business plan.
2) Compliance Risk:
There are a lot of laws and regulations which every business person have to abide. One should handle his business very keenly by protecting your data and payment process says Gaurav Mohindra. You must have complete knowledge of all applicable laws of the respective governments such as laws governed by Occupational Safety and Health Administration, The Environmental Protection Agency and other administrative departments of the state to minimize compliance risks.
3) Security and Fraud Risk:
Hacking has become common nowadays as people extensively use cellular phones, and a lot of personal data is shared on it. Almost all businesses use technology to operate nowadays. Therefore, a cyber crime like data theft and fraud in payment is on the rise, thus affecting the overall businesses. These risks often spoil the reputation of the business, and the company is responsible for every kind of data theft or any other fraud. The company must concentrate on security solutions, bring measures for fraud detecting and educating both its employees and customers to prevent such crimes under the risk management program.
4) Financial Risk:
Financial risk is a broad segment which involves a lot of factors like credit extend to the customers, funds for financing the long as well as short term capital of the firm. Also not to forget the fluctuations of the rate if the debt that the business has taken from the market. Keeping the debt to the minimum amount as possible is the only solution to this problem. This will help you cope up with uncertainties in a better way.
5) Reputational Risk:
All the business works on the goodwill factor; the success in business depends a lot on the goodwill. So any reputational loss is a risk which often many companies faces due to the wrong product quality, unsatisfied customers says Gaurav Mohindra. So these risks are quite evident in all business unless they take the right precautions.