Causes for Business Risk

Causes for Business Risk

Business risk cover a lot of factor and it arise due to lot of causes. Here we mention some important causes for business risk: -

Causes for Business Risk

Human factor: - This factor has an important role in business risk. A single carelessness mistake by any individual may lead a big accident and involve loss of life and property. We include in it like – relationship between different levels, estimating of manpower and demand of product.

Capital goods: - Mechanical defects also have causes of risk. A explosion in any machine may cause for death of man power and a loses of raw materials. Lack of proper machine care may result of accident in production line.

Economic factor: - In it, we include change in demand of product and pricing war in between the market due to competition. We also include change in technology or economic working conditions.

Natural and miscellaneous factor: - Nobody can the natural factor like rain, flood, drought, snowfall and earthquake etc. Nobody can make for-caste for these areas. Some changes in the government policy like tax or licensing etc come under the miscellaneous factors.