“Life is either a daring adventure or nothing at all.”- Helen Keller
Coming to think of it, we all love the adrenaline that comes from taking risks. Whether it is riding a roller coaster or putting it all in a game of poker, it all feels easier after taking the first step. In the business of industry, it’s pretty much the same, taking that first step in developing the product that you always dreamt of is the hardest step. A lot of questions will keep running in your head, will it be successful? Am I going to waste my money and energy for nothing? What if it works and I won’t manage to keep it that way? These are all questions that a new Entrepreneur might think of.
You must know that you won’t be able to go anywhere without taking some risks. You must believe in yourself that these risks won’t be for nothing, but instead they will be a life-changing risks. Keep in mind these 5 things that you as an Entrepreneur must know about taking risks.
1. Risk-taking is a must in entrepreneurship
In order to be a successful entrepreneur, you must be willing to take some risks, so unless you are willing and going to do that, you may want to find another thing that involves no risk-taking because almost every accomplishment in the history of business has come to the hands of people who took risks, people who were ready to explore the unknown. Once you put effort into collecting the information needed ahead of time, you’ll be able to handle any crisis coming your way, and you will be more deliberate about the situation rather than being panicked.
What are these risks some of you may be wondering? You’re going to invest some of your own personal capital in the process of growing your business. In most cases, you’ll sacrifice having a steady pay check for several months and up to a year, so basically it’s going to be tough in the beginning, but you’ll never know if you never try.
2. Taking risks will improve you
“what doesn’t kill you makes you stronger”
There are two different outcomes of risk-taking, either that risk being successful, or being a failure. However, failing should never mean giving up, as an entrepreneur you must not turn that failing into your reality. Even though you faced disappointment, you have to know within yourself that it’s not the end until you make it.
Failure should be the push you needed in order to blow up, and get to the next level of planning strategically. Learn from your failures and move on, and always believe in yourself. Making mistakes gives you knowledge. These unlucky attempts will sharpen your mind for future decisions, and will let you know whether you’re going the correct way or not.
3. Taking risks differentiates you from others
The rough times are going to come, but they have not come to stay, they have come to eventually end. Most people are not risk takers, they earn a minimum wage, and they stay on that minimum wage for their whole life. Taking some risks will make you stand out in the middle of this crowd and breakaway from the rest.
The idea that you must know and keep repeating to yourself, is that you either take the risk or lose the chance. Follow your ambitions, and never listen to those who are afraid of taking risks because they don’t have that vision of yours.
4. Calculate the results of the risk
There are a lot of risks that you are going to face as a new entrepreneur. Whether if they were big risks or small risks, some of these risks results are easy to predict based on others experiences. As an example, let’s say that you have a project that targets mainly elders, so a small research on your area could show you if a product like yours is going to blow up or not based on the population statistics. There are few things you could do to predict the risks outcome:
- Identify the risks: Learn from others experiences, and write down the potential risks outcome that might happen out of blue without you having any sort of power over them.
- Take action: Prepare a couple of immediate actions in order to maintain t the outcome if it was a bad one such as equipment failure, or a market crisis. These backup plans could save your business from totally collapsing.
- Prepare the employees: Keep reminding your employees of their role in identifying, controlling, and reducing the unlucky outcomes. If each and every one of the employees was prepared, the outcomes could be easily maintained by the previous set actions.
- Learn from your mistakes: Document each of the risks outcome in order to avoid falling in the same mistakes over and over.
5. Various types of business risks to be aware of
There are two types of risks, those you take in order to start, which are good risks, and those that are dangerous enough to close your entire business. As said earlier, you might face a lot of problems as a new entrepreneur, but being aware of all or some of the issues that might come to your way, will definitely help you on the long run. Some of the businesses collapse suddenly and close due to their lack of awareness about the risks that could happen. Here are some of the business risks that you must have a plan for.
- Economic risk: The economy is continually changing as the market sectors fluctuate. Some changes could be beneficial and useful for your business; however, some other changes could be negative for your business as they reduce your sales tremendously, and that’s a solid reason for you to keep an eye on the market changes and be completely prepared for an economic downturn.
- Fraud and security risk: The second your business expands and becomes known, it becomes more targeted by hackers. They will try to breach any sort of data in order to steal identities or valuable information, which will cost the company a fortune since it’s financially liable for any data fraud or breaches, so make sure that you have the required tools to maintain the security, and educate the employees how to detect any potential issues.
- Reputation risk : There has consistently been the risk of an upset client popping out of nowhere, which might cause them in some cases to open a lawsuit and affect the company’s image. Nowadays, social media has even made it easier for these upset clients to ruin a business reputation. One negative tweet is enough sometimes to decrease your customers and cause the income to fall, so make sure that you have this issue covered by consistently responding to these upset customers and help them with any concerns immediately.
- Operational risk: This kind of risk could happen suddenly, and it might be caused by external, internal, or nature damages. As an example, a fire hazard or any natural disaster that could affect your physical business or some technical mistakes that could be caused by one of your employees, which will cost your business time and money.
Whether it’s a failure caused by nature or people, these operational risks might impact your business highly in terms of time, money, and reputation. Be prepared for each of these potential risks through educating yourself and your employees about a continuity plan. List down all these causes and create a backup plan that provides a way of reacting and establishing a recovery system or proactive measures to ensure that the operations won’t stop.
Hopefully your idea of risking has changed after acknowledging some of the issues that might face you on the long run. These five things should help you prepare some kind of a plan strategy in order to start your business correctly. Always keep in mind that most of the risks mentioned probably won’t happen, but you have to be prepared for any scenario just in case, and finally, good luck with your business.