Conduct an online search for a small business to study. Note that small businesses typically have fewer than 500 employees. If you already have a small business in mind, you can skip to the next step.
Review the company’s websites, sales literature, competition, and any other online information that you think may be relevant to understanding their risks.
Consider these questions:
Are the risks to the business mostly external, internal, or both?
Does the business operate in a naturally hazardous or heavily regulated industry?
Does the location of the business make it vulnerable?
Do aspects of the business’s operations make it susceptible to people risks?
Does the business operate in a way that leaves it open to technology risks?
One small business that I found during my online search is a family-owned coffee shop located in a busy downtown area.
After reviewing the company's website and social media presence, I found that the risks to the business are both internal and external. External risks include competition from other coffee shops in the area, fluctuating coffee bean prices, and changing consumer preferences. Internal risks could include issues such as employee turnover, supply chain disruptions, and quality control.
The coffee shop operates in a heavily regulated industry, as it must adhere to health and safety regulations, food handling guidelines, and business licensing requirements. Additionally, the location of the coffee shop makes it vulnerable to factors such as foot traffic, weather conditions, and economic trends in the area.
In terms of people risks, the business may be susceptible to issues such as employee theft, customer complaints, and employee training and development. As for technology risks, the coffee shop's reliance on point-of-sale systems, online ordering platforms, and social media marketing could leave it open to cyber attacks, data breaches, and technological glitches.
Overall, this small business faces a variety of risks that must be carefully managed in order to ensure long-term success and sustainability.