Risk Management

Individuals, financial advisors, and companies can develop risk management strategies to manage risks associated with their investments and business activities. Strategies including diversification and derivative positions, often allow investors, traders, and business managers in measuring and quantifying risk. We provide the following risk management services:

Economic Risk

Due to market fluctuation, the economy is ever-changing. While negative events can reduce sales, some positive changes may lead to booming purchase environments. It's important to keep an eye on these changes and trends to potentially identify and plan for an economic downturn. To counteract economic risk, save as much money as possible to maintain a steady cash flow. Also, operate with a lean budget with low overhead through all economic cycles as part of your business plan.

Compliance Risk

Business owners need to comply with an abundance of laws and regulations. For example, recent data protection and payment processing compliance are likely to impact how you handle certain aspects of your operation. Businesses can minimize the risks by staying well versed in applicable laws from both federal agencies like the Occupational Safety and Health Administration (OSHA) or the Environmental Protection Agency (EPA) as well as state and local agencies.

Non-compliance may result in significant fines and penalties. Remain vigilant in tracking compliance by joining an industry organization, regularly reviewing government agency information, and seeking assistance from consultants who specialize in compliance.

Financial Risk

This business risk may involve credit extended to customers or your own company's debt load. Interest rate fluctuations can also be a threat.

Making adjustments to your business plan will help you avoid inefficient cash flow or creating an unexpected loss. Keep the debt to a minimum and start creating a plan that lowers the debt load as soon as possible. If you rely on income from your clients, your financial risk could be significant if they no longer use your services. Start marketing your services to diversify your base so the loss of one won't devastate your bottom line. 

Reputation Risk

There is always a risk associated with an unhappy customer, product failure, negative press, or lawsuit that adversely impacts a company's brand reputation. However, social media has amplified the speed and scope of reputation risk. Just one negative tweet or bad review can decrease your customer following and cause revenue to plummet.

To prepare for this risk, leverage reputation management strategies to regularly monitor what others are saying about the company online and offline. Be ready to respond to those comments and help address any concerns immediately. Keep quality top of mind to avoid lawsuits and product failures that may also damage your company's reputation.

Operational Risk

This business risk can happen internally, externally, or involve a combination of factors. An unexpected event like a natural disaster or fire, server outage caused by technical problems, or employee mistakes may cause you to lose your business. Whether it's a people or process failure, these operational risks can adversely impact your business in terms of money, time, and reputation. Address each of these potential operational risks through training and a business continuity plan. Consider a way of thinking about what could go wrong and establish a backup system or proactive measures to ensure operations aren't affected.

Competition (or Comfort) Risk

No doubt, businesses will always have some competition in their industry, but what affects their presence is missing out on competitors’ offerings that may appeal to your customers.

The increasing competition combined with an unwillingness to change may result in a loss of customers. For instance, a company just being comfortable with their success but lacking on continual improvements may contribute to the business risk.

Enterprise risk management means a company must continually reassess its performance, refine its strategy, and maintain strong, interactive relationships with its audience and customers. Additionally, it's important to keep an eye on the competition by regularly researching how they use online and social media channels.