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Businesses Risks Management

Risk Management

Risks can ruin managed your business but if well  the loss can be prevented from occurring or minimized to a small amount. Here is how you can go about losses that are frustrating the growth of your business. You should design preventive measures to either eliminate the whole loss from occurring or mitigate the loss if the risk occurs. Theft can be minimized or prevented by training your staff effectively.

Train your staff on the tricks thieves use or by educating them on how to differentiate genuine money and forged one. Teach them about counterfeited products that will result into losses if purchased into your business.  Install burglar alarm in your business. Getting services of a watchman in your business will be of great help in avoiding your business from being broken into during odd hours by thieves.

Minimize the loss of bad debts from occurring in your business by reviewing your customer’s ability to pay. Before you grant them credit, try to know their payment history. Ask them to give you their current bank statement in order for you to ascertain their financial status position if they are intending to buy expensive goods.

Factoring will ensure that losses from bad debts will not affect you as a seller. The use of del credere agents service will protect you from bad debts which results into losses.

Constructing a fire proof in your business will avoid the risk of your business properties from being destroyed by fire. In losses associated with inventory, you can avoid them or minimize them by using various inventory monitoring strategies. This will ensure that your business is neither overstocked nor under stocked.

The use of a trademark and brand name in your business will protect your products from competition and against counterfeited products. You won’t lose the demand for your products resulting from counterfeits because your customers will be able to differentiate between counterfeits and your products through your brand name labeled on your products.

You may also use services that shift risks. Shift the loss from your shoulder to others shoulders. Insurance companies are there to take the loss on your behalf. When a loss occurs, you won’t feel its effects hence your business will be doing business as usual.Your business losses arising from changes in prices can be shifted through hedging. Hedging is where one enters into a future contract. So, even if prices changes the contact will be executed using the price agreed upon during the time the contract was formed.

Losses arising from changes on fashions can be minimized by clearing the stock. Sell the whole stock by offering a discount to customers.

Reorganizing your business will help your business in absorbing losses. Amalgamation will greatly strengthen your business in several ways hence mitigating the loss.

Government through tariff on imported goods will protect your business from risks. If it does this, the demand for home goods will arise hence fetching good prices against foreign goods that are highly priced due to government tariff.

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