How to Reduce Risk

By Andrea Travillian

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Self employment is risky. We hear that said many times, it is usually the first thing that comes up for those who are thinking of starting their own business. Let’s take a minute to see what risk is and how to eliminate it!
Risk by definition is the chance of suffering harm or loss and the uncertainty of all of this unknown. Instead of worrying about how you can handle risk, worry about the best way to reduce risk. The best way to reduce risk is to plan how you are going to eliminate the possibility of loss or harm occurring. The more you know the less risk you have. So how do you plan to eliminate risk?

1. Create a list of all possible risks for you in starting a business. This can include income, time away from family, start-up costs, location, experience – you name it if it could be a problem for you put it down.

2. Study your personal situation, how long can your finances make it? Do you have the traits to be self employed?

3. Your prospective businesses chances – try many what if scenarios, not just one best case scenario. When doing a plan do a best, good, bad scenario and know what to do to handle the business during each scenario.

4. Talk to others about your feelings about going into business for yourself. Many times talking through issues and having a person as a sounding board is very beneficial! At the least journal about them.

Planning eliminates lots of risk and makes you more comfortable with the steps you do take! Don’t sit on the sidelines because of risk, make a game plan and start playing!