Summary Content |
Business risk is the probability of potential losses compared to a planned outcome. Under risk, a company may lose some or all of its resources, fail to generate expected revenue, and incur additional expenses.
Potential risk factors:
- Lack of experience in starting a business. Opening a beauty salon is the first step into the world of business for a business owners. Akcininkai yra kompetentingi bei patyrę vadybos srityje, tačiau gali nutikti taip, jog jiems pritrūks praktinių įgūdžių bei įžvalgumo susidūrus su atsiradusiais sunkumais išlaikant verslą. Patyrus pirmuosius nuostolius, akcininkams gali pritrūkti ryžto, tikėjimo bei drąsos tęsti tolimesnę įmonės veiklą. Šią riziką galima sumažinti sutelkus visų akcininkų turimas žinias bei patirtį.
- Possibilities of influence of external factors. A company's operations are particularly dependent on its clients' income and the country's economic situation. The current economic crisis and its consequences—unemployment, tax increases, and economic downturn—are negatively impacting clients' incomes. People's incomes are limited, so they save and purchase only essential goods. Due to declining client income, a newly established company risks receiving less attention and lower profits. To mitigate this risk, the company will be forced to lower prices and increase advertising spending.
- Reducing the number of potential users. The current emigration situation in the country also reduces the number of potential clients. Most emigrants are young people who use beauty salon services, so this factor is unfavorable for our company. Unfortunately, the company is unable to mitigate this risk, and in this situation, government intervention is necessary.
- Decisions taken by the government. The government influences the adoption, implementation, amendment, and repeal of legal acts that companies must adhere to in their operations. It's possible that the government will change legal provisions to the detriment of the company, increasing profits, VAT, and other taxes, forcing the company to raise prices for services and corporate expenses. Unfortunately, the company will be unable to mitigate this risk and will be forced to adapt to the current situation.
- Competition. Existing and new competitors entering the market can pose a significant threat by offering more attractive services, lowering prices, and attempting to lure customers away. To avoid being overshadowed, a company will also be forced to lower prices and invest heavily in advertising.
If the company fails to establish itself in the beauty service market, we'll try opening a simple hair salon that will only offer man and woman of haircuts. We'll make it because the existing equipment and furniture are suitable for this type of business, and there won't be any need to lay off staff.
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