Business risks

Business risks

business risks

Companies are exposed to various risks, the main ones being the economic crisis.

To deal with these threats that could hinder success, their focus is primarily on optimizing their business.

Businesses achieve this by first reducing costs and increasing efficiency, for maximum profitability.
Definition of risk

Risk is the likelihood of an adverse event occurring and its consequences for the survival of the business. Companies put in place strategies to manage these risks and thus be able to carry out their activities.

The main emphasis of risk management is on identifying what could go wrong in order to anticipate and be able to deal with the problem to decrease the possibility of failure.
The main risks in business

The Anglo-Saxon insurer AON Risk Solutions conducted a survey in 2015 entitled Global Risk Management. It shows that cybercrime is making its first entry into the top 10 most important risks to a business, which is why many companies are so keen on cyber risk insurance.

At the top of the rankings is the damage to reputation and brand image, followed by the economic downturn in the recovery, then regulatory and legislative changes.

In fourth place, increased competition is a source of concern for business leaders.

Second, the inability to attract or retain top talent, as well as the inability to innovate and meet client needs, is always emulated during meetings.

In seventh place, you will find operating losses for which you can take out business interruption insurance to limit financial losses, then in eighth place in the top 10 the damages and claims relating to professional civil liability that you can cover through the subscription of a RC Pro insurance

Finally, cybercrime still occupies ninth place in the ranking, just ahead of property damage.

Let us evoke a last type of risk, less recognized but unfortunately more and more frequent, the risk of kidnapping and extortion. For more information, we invite you to read our article on kidnapping and ransom insurance.
A multitude of risks on a daily basis

In addition to the risks analyzed by the AON survey, other categories should be taken into consideration such as strategic risks, for example a competitor entering the market.

Financial risks are also of great concern to companies, such as the increase in interest on a loan or delinquency.

Operational risks are also to be taken into account because a breakdown or the theft of essential equipment would prevent the structure from functioning properly. In particular, you can take out machine breakage insurance to cover these risks.

In addition, environmental risks, including natural disasters, must be taken into account, as must the political and economic instability in a country to which goods or services are exported.
Financial, environmental and compliance risks

The need to comply with laws and regulations, as well as the need to act in a way that wins over investors and customers, drives companies to put in place adequate strategies.

They are ready to change their well-established way of working and to modify their offer to take into account the legislative texts. This was particularly the case with tobacco products and asbestos.

Thus, concerns about increasing obesity could prompt companies to put in place more stringent food labeling regulations, despite the fact that this would necessarily increase costs and risk limiting the attractiveness of food. certain ingredients.
Financial risks

Companies are exposed to risks related to the transactions carried out. They have an obligation to carefully review their daily financial operations to ensure that the cash flow is in good shape.

As a result, if you have a loyal customer who suddenly can't afford to pay you, the viability of the business becomes uncertain. It is worth considering what steps to take to collect the bill and consider purchasing credit insurance to protect against losses.

Financial risk is also based on external factors such as changes in rates that affect your ability to repay your debts as well as the competitiveness of your products.
Environmental risks

The pay-polluter principle stems directly from the responsibility