Category 1
The potential for negative changes within a specific industry that can impact a business, such as new regulations, technological advancements, or increased competition.
What is Industry Risk?
The possibility of financial loss due to changes in market conditions, such as shifts in consumer demand, economic downturns, or competitor actions.
What is Market Risk?
The risk that a product may fail due to design flaws, lack of demand, production issues, or safety concerns.
What is Product Risk?
The risk associated with managing a business’s finances, including issues related to cash flow, debt, funding, and profitability.
What is Financial Risk?
The potential for poor decision-making by business leaders, which can negatively impact the company’s growth, strategy, or profitability.
What is Management/Decision Risk?
The personal risk an entrepreneur or professional takes when investing time and resources into a business venture, which could impact future career opportunities if unsuccessful.
What is Career Risk?
The psychological and emotional stress associated with entrepreneurship, such as uncertainty, burnout, and work-life balance challenges
What is Emotional Risk?
The point at which total revenue equals total costs, meaning a business is not making a profit or a loss. It’s the minimum sales needed to cover expenses.
What is Break-even point?
The financial gain remaining after subtracting total expenses from total revenue. It indicates a business’s success in generating more revenue than costs.
What is Profit?
The total amount of money a business earns from selling its goods or services before deducting any expenses.
What is Sales Revenue?
The portion of sales revenue that remains after deducting variable costs. It helps determine how much contribution each sale makes to covering fixed expenses and generating profit.
What is Variable cost margin?
Costs that do not change with the level of production or sales, such as rent, salaries, and insurance.
What is Fixed expense?
Costs that fluctuate based on production or sales volume, such as raw materials, shipping costs, and sales commissions.
What is Variable expense?
Payments made to salespeople based on the amount of sales they generate, usually a percentage of the sales value.
What is Sales Commission?
The costs incurred during the normal course of running a business, including rent, utilities, salaries, marketing, and administrative expenses.
What is Operating Expense?
Expenses that have both fixed and variable components. For example, a salesperson’s salary may include a base salary (fixed) plus commission (variable).
What is Semi-Variable Cost?
Funds used by a business to acquire, upgrade, or maintain physical assets such as property, buildings, technology, or equipment. These are long-term investments that help the business grow.
What is Capital Expenditures?
A pricing strategy where the selling price is determined by adding a markup to the cost of producing or purchasing a product. It ensures that costs are covered while allowing for profit.
What is Cost-based Pricing?
Violating someone’s legal rights, such as copying a product, idea, or creative work without permission.
What is Infringement?
Using a brand name, logo, or slogan without permission, leading to confusion.
What is Trademark Infringement?
A company’s efforts to help society and the environment beyond making a profit.
What is Corporate Social Responsibility?
Business expenses related to office work, management, and operations.
What is Administrative Cost?
Payments made to experts, such as lawyers, consultants, or accountants, for their services.
What is Professional Fees?
Money spent on computers, software, and other digital tools for a business.
What is Technology Cost?
Payments and perks given to employees, including salaries, health insurance, and bonuses.
What is Wages and Benefits?