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How Well Is Your Business Managing Risk?

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There are so many elements to juggle when you run a small business, it’s no surprise that so many entrepreneurs find themselves burning out. A healthy business needs to maintain healthy cash flow to ensure that they’re able to make the judicious investments that will help them to grow their businesses. They need to ensure that their employees are happy, healthy, motivated and incentivized. They need to ensure that their operations are carried out smoothly and time efficiently in ways that keep productivity optimal and prevent the waste of time, effort and resources.

While all comprehensive business plans tend to contain a detailed and elaborate risk assessment, it’s vital that you remember that risk is an ever present and constantly evolving concern for entrepreneurs. There’s a new risk with every coming year, with every step your competitors make and with every technological innovation in your field. Is your business doing enough to manage the unique and specific risks presented to it?

Risks To Your Product

If your business hinges on your ability to manufacture and sell a product, or range of product, there are a range of risks to your product. The measures you put in place will depend largely on the nature of the product.

Makers of expensive and delicate electrical equipment like transformers, for example, use products manufactured by https://impactograph.com/ to ensure that the risk of damage in transit is reduced. Your product may face similar risks, or the risk of obsolescence by a competitor’s product or the risk of public liability should the product lead to the endangerment of a user.

Risks To Your Productivity

Your productivity is an important measure of your efficacy as a business. Poor productivity can cause your business to hemorrhage money, create insufficient supply to increase demand or at the very least, lead to longer and more difficult working hours that could cause you and your employees to burn out.

As such, businesses need to constantly revise their working practices and strive for innovation wherever possible. If you spend most of your working day with your sleeves rolled up at the “coalface” with your employees, chances are you’re not taking the time needed to look at your business strategically.

Risks To Your Growth

Getting a fully functioning enterprise off the ground is a remarkable achievement, but the best entrepreneurs know the dangers of resting on their laurels. If businesses are not allowed to grow organically they can stagnate and fall short of their competitors, eventually facing obsolescence and liquidation.

The biggest risk to your growth will be cash flow and it’s essential that businesses take steps to prevent cash flow or at the very least open up sufficient lines of credit should cash flow dry up. Even risk aversion or over cautiousness can prevent an entrepreneur from making the capital investments that they know will help facilitate growth.

Risks To Your Brand

Your brand is about so much more than your logo or the shade of green you use for your website banner. It’s embodies in your every interaction with customers and clients and it’s implicit in the quality of your product. Just look at what happened to Blockbuster video for a cautionary tale of what can happen if businesses don’t take steps to stay relevant or meet the needs of their target market.

 

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About Author

Ben is a follower of Christ, a rabid computer geek, small business owner, and breaker of things. He is married way above his station in life and has three wonderful children who have made driving him insane their mission in life.

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