Business Risk

Business risk implies uncertainty in profits or danger of losses on account of internal and external decision and events. The risk is inherent in every area of business activity and varies according to the nature and size of business. Some examples of risk are an irregular supply of raw materials breakdown of machinery, price fluctuations, errors in sales forecasting, trade cycles, natural and manmade disturbances etc. Risks are inevitable and cannot be eliminated but only controlled through proper preventive and corrective measures of risk management. First, it is important to sort the risks faced in business to know them better.