Business Risks

Business Risks Definition and Examples of Business Risks

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Business Risks – In running a business, of course, we will always be faced with two choices, namely success or failure. It is not an easy thing to run a business because a business is not just profit but also the risk of failure and loss.

Therefore to start a business requires a level of courage, determination and also a capable business strategy.

This courage, determination and good business strategy are needed by a businessman to face challenges such as facing business risks.

When you run a business, of course, you will face various challenges and difficulties that keep coming. All of these challenges and difficulties are often referred to by filling in the business risks.

Business Risk Definition

business risk definition

Before we discuss business risks, you should know the definition of business risk.

Business risk is an integral part of running a business. But here is the art of a business because with these risks a business can grow rapidly.

Uncertainty in running this business is often the main reason why many people are reluctant to become businessmen.

The word risk is an absorption word from the English language that is a risk that can be interpreted as constraints, failures, obstacles, dangers or losses.

Some understanding of risk according to experts

  • Arthur William and Richard, M.H.: Risk is a variation of results that may occur in a certain period
  • Soekarto: Risk is uncertainty over the occurrence of an event.
  • Herman Darmawi: Risk is the probability of results that are different from expectations.
  • Prof. Dr. Ir. Soemarno, M.S.: Risk is future uncertainty about losses.
  • Subekti: Understanding risk is the obligation to bear losses caused by events beyond the fault of one of the parties.

Based on the opinions of some experts above about the meaning of risk, it can be concluded that risk is a possibility that can occur and result in losses.

The definition of business risk is a bad possibility such as constraints, failures, obstacles, losses that may arise in the future due to efforts to carry out the business carried out at this time.

Even though a businessman must be brave to take risks, it does not mean that business people still have to keep measuring and carefully considering. With careful consideration, the player will be better prepared when the risk arises into reality.

According to Abbas Salim, the uncertainty of risk faced is caused by the following 3 (three) factors:

  • Economic uncertainty (Economic Uncertainly Caused)
  • Nature uncertainty (Nature Uncertainly Caused)
  • Behavioral uncertainty (Human Uncertainly Caused)

In addition to the three factors above, there are actually several other factors that can affect uncertainty. Some of the factors that can influence the emergence of risk include social, economic, environmental, technological progress, etc.

Errors in marketing and also decision-making errors can also pose risks.

Examples of business risks

business risks examples

In running a business, a businessman must be brave and carefully take into account any risks that may arise.

Therefore, before you run a business, you should do business research and analysis so that the risk can be measured.

Based on the control, business risk can be categorized into 2 (two), namely:

a. Business risks that can be controlled

This business risk category is a risk that has been predicted from the start. For example, businesses that are just starting but sales are still far from the target. This certainly makes the effort not bring profit and return on capital.

But the risk of this business can still be controlled by businessmen for some time. Business people will study the causes of their products not selling then fixing them.

If the new product is still not experiencing improved sales, business people can stop marketing the product and replace it with other products.

b. Business risks that cannot be controlled

This business risk category is different from the risk that can be controlled and can still be found in a solution.

The type of risk that a businessman cannot control such as fraud, fire, theft, etc. These unpredictable events are risks that are unpredictable and previously thought.

If you are new to the business world, you should consider a few examples of the following business risks:

1. Competition or competition

Competition or competition is a risk that must be faced by every entrepreneur. This is due to the increasingly advanced business will automatically emerge competitors of similar businesses.

The emergence of this competition sometimes creates high risk due to unfair competition. This unhealthy competition can cause losses for business people.

2. Technological development

The rapid development of the technological world can help businesses to develop business both in terms of quality and quantity of sales. Therefore, modern business people must be able to adapt to the technology Agat is not left behind with competitors.

But today many business people in Indonesia are not following the development of technology so that many businesses are starting to shut down.

3. Loss of consumer confidence

The most important thing in running a business is maintaining consumer confidence. Loss of consumer trust can be caused by various things such as poor product quality, price misstatement, shipping errors and after-sales service.

Some of these errors can have a negative impact so you will be left behind by consumers.

4. Financial risk

When you start a business, you must be prepared with non-permanent income. This is because in running a business does not always get a large amount of profit.

Of course, this will be an obstacle so that you have to prepare mentally and prepare solutions so that they don’t have a bad impact on your life.

5. Changes to government regulations

Changes in government regulations can be a risk to the survival of your business. errors in anticipating government changes can affect business activities so that they can affect marketing and sales.

In addition, make sure that the business that you are running has complied with every government regulation so that it can run the business about and be safe.

6. Environmental risk

Environmental impacts caused by your business must be considered. For example, you have a food business that produces hazardous waste.

So make sure that the waste produced is disposed of properly so that it is friendly to the environment.

7. Marketing risk

One of the keys to business success is an effective and appropriate marketing process. Therefore, a businessman must master various marketing techniques so that the products you sell can be received by consumers.

If you do not master effective and appropriate marketing techniques, you can risk the number of sales of your product.

To master this marketing technique, you can learn by reading books, participating in seminars or looking for various information about marketing on the internet.


Business risk is something that cannot be separated from business. This is what causes many people who do not want to start a business because they are afraid to take risks.

But you can actually manage these risks by identifying, evaluating and controlling risks.

Such is the discussion of the definition of business risk and an example of business risk.

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