Business Critical Risks
When you’re starting or operating a business your Company is going to face a number of critical risks. The Business Plan should be used to identify these critical risks. Realize….If you don’t identify the critical risks your Company will face then someone else will.
The best course of action is to ensure that your the one to frame the critical risks the Company will face, This will allow you to develop a place to mitigate them. Not only does this make you look smart but it also establishes a plan that will make sure you don’t succumb to the risks.
Every Company faces different critical risks. If you can’t figure out how to mitigate or avoid a risk there probably is a major problem with you business idea or business model. You definitely don’t want to start out just hoping to avoid the risk altogether. The following is a brief list of common risks.
- Legal/Intellectual Property (Patents, Copyrights, Etc.)
- Building, Strengthening and Maintaining Brand
- No operating history
- Financial Projections (There’s lots here)
- Supply Costs
- and many others
If you’re going to use your business plan to raise funds then you need to have critical risks identified up front for the banker or investor to understand. In advance it’s best to come up with several courses of action you can take or reasons why/how you will mitigate the risk. Often time’s a major risk for a Company is simply the fact that it is a startup Company with no operating history. In this instance, you want to describe how your experience and the experience of your team is going to ensure you don’t make the typical mistakes of a start-up. For all the risks make sure you have explained in detail several ways you will or have mitigated them.