The Risks of Business

Owning your own business is a very exciting step to take in life, with a lot of rewards along the way. However there are also many risks that come with owning a business, or even with running someone else’s business from the top position.

Of course, the obvious risks that come to mind are generally financial, such as going into liquidation or bankruptcy. Some of these financial problems can even become a personal problem, for example if you are served with a Director Penalty Notice.

But these days there are also other risks and problems you will face that you need to consider. Some of them may feel like a smaller part of your day-to-day business dealings, but they are all very important.

All companies need to do a risk assessment of their own business. As some industries are exposed to different risks than others you will need to analyse the potential threats specific to your industry and company. You need to keep in mind that there are also risks that are outside of your company that you need to be prepared for, such as interest rate rises or natural disasters.

As a company, you will need to learn to anticipate and respond to threats, and adapt to changes as part of your risk management process.

Below, we take a look at just some of the concerns that face business owners today:

Managing Talent

What is a business without talent? You not only need staff to keep the company running, but you need good staff to keep it successful.

We are in a time where companies are now facing the prospect of the baby boomer generation leaving the workforce. This is a blow to many businesses as the training and knowledge these skilled workers possess is hard to replace.

The impact is, many companies are now looking for new talent and they need to find them before competitors do. Once they have them, they will need to put into place a great learning management system to not only train the employees but to retain them.

Emerging Markets

Emerging markets can actually be a huge positive to many companies. If you are in a position to move into these new markets early on, you can dominate this new area and become very successful. But of course the flipside to this is that if you are not in a position to have presence in an emerging market, you will likely see your competitors go in and gain the edge instead. As emerging economies are dominating global growth, while developed countries are suffering economical crisis, you can see why it is such an important strategic move for companies to be able to move into the emerging markets.

Corporate Social Responsibility

Today there is a huge focus on corporate social responsibility from consumers. And thanks to new media such as social media, consumers have more voice than ever before.

A huge part of the social responsibility lies within environmental issues and being green. Companies are now under the spotlight as their impact on the environment has come to the forefront of the public mind.

Businesses are facing threat to their reputations and so they need to be careful to maintain – or in some cases rebuild – the trust of the public. Part of this reputation management is to listen to the public and to respond to them, not sweep their viewpoints under the carpet.

Many companies also need to make some long-term changes to how the business is actually run, the supplies they use and how they dispose of waste. Of course, this means there is a financial impact on the businesses as they make this transition.

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