Business risk

B) Single out the main points of the text.

A) Read the text carefully. Fill in the blanks with the prepositions where necessary.

READ AND DISCUSS

III. ORAL PRACTICE

1. Make up the dialogue on the following. Make use of such phrases: as far as I know…; therefore; judging from my own experience…; taking into consideration that…; it is common knowledge that…; on the contrary; it must be pointed out that…; I am into two minds, but ….

1. Risk management influences positively the business process.

2. The actual process of risk management varies from company to company.

2. Prepare a short talk on the following:

The importance of risk management in contemporary business world.

A business risk is a circumstance or factor that may have a negative impact on the operation or profitability … a given company. Sometimes referred to as company risk, a business risk can be the result of internal conditions, as well as some external factors that may be evident … the wider business community.

When it comes to outside factors that can create an element … business risk, one of the most predominant risks is that of a change in demand … the goods and services produced … the company. If the change is a positive one, and the demand … the offerings of the company increases, the amount of risk is decreased a great deal. However, if consumers demand for the offerings decreases, either due to loss of business to competitors or a change in general economic condition, the amount of risk involved to investors will increase significantly. When a company’s risk factor is considered to be increased due to outside factors that are beyond the control … the company to correct, chances … attracting new investors is severely limited.

Internal factors may also result … the development of significant business risk for the investor. Often, these are factors that can be identified and corrected. If flagging sales can be attributed to an … ineffectual marketing effort or a sales force that is not performing up to expectations, making changes in the marketing approach or restructuring the sales effort will often result in minimizing the perception of business risk … the part of potential investors. The same is true if a company’s manufacturing facilities are not operating … optimum efficiency. Revamping the operational structure of the plants and facilities will decrease the element of business risk and … result in higher profits … the same level of production and sales, which will in turn make the company more attractive to potential investors.

In general, any investor will consider the relationship … a company’s securities and the business risk associated with the company before choosing to invest in the future of the corporation. While there is an element of business risk associated … any corporate operation, proper … management will result in creating a balance between assets and securities that will keep the degree of business risk attractive to individuals and entities that consider investing funds … the operation.

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