Risks are unavoidable for any business, or sector, as nothing can be perceived for certain or taken for granted.
The external factors, from which the risks appear from, arise without any earlier notification.
It is important to take all the necessary measures in advance so as to have the capabilities and abilities to overcome any unexpected short-term or long-term risks.
Risks can be of five key types
Therefore, before taking into consideration on how to handle risks, we must identify which ones may appear the most, along the way, such as:
- There are cases where the business plan is not executed as expected or predicted, and therefore leading to the so-called ”strategic risk”. The strategy, the tactics, and in general the whole concept breaks apart
- The legal and compliance aspects can also be of high risk in the scenario where the business hasn’t obliged with certain legal criteria
- The operational risk defines the failure in running the day-to-day operations of the business smoothly
- Financial risk defines the condition where the business failed to meet its cost and revenue management obligations
- Reputation is the most, or rather the most important criterion for business survival, as bad reputation could bring a firm’s branding to super low levels