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01 SUPPLY RISKS WHAT IF… Suppliers are powerful enough (e.g.: monopolies) to extort upstream There is a shortage of the supply of raw material, either because of natural disaster (like drought), a man made disaster (like war), or because a competitor (or some other market player) buys it all out first The cost of your raw material fluctuate You are exposed to currency risk across borders? What about policy risk such as tariffs There is risk of raw material spoilage between when you buy it and when you use it Your access to raw material does not scale with projected revenue/units sold Your demand forecasts are way off (in time or scale) You can’t control the quality of raw materials There is industry consolidation that affects your suppliers Your suppliers go bankrupt
02 PRODUCTION RISKS WHAT IF… Your manufacturing process outputs poor quality Your partner does not meet contractual expectations You cannot scale in line with units sold It takes longer than expected to produce You cannot protect your IP, especially when a partner is collaborating Your plant fails (natural disaster) Your employees strike
03 LOGISTICS RISKS WHAT IF… Your goods are spoiled, damaged, stolen, destroyed, or lost in transport You suffer from import/export, or other, delays You experience delays and long holding costs Your partner goes bankrupt or has worker issues There is consolidation in the logistics chain (mergers/acquisitions) The cost of logistics such as duties, shipping costs, or trade financing goes up You receive compliance fines Your product platform is not extensible (or requires full rewrite in Version 2)
04 DISTRIBUTION RISKS WHAT IF… Sales take longer (or is more expensive) than expected You can’t actually sign distributors You get into exclusive partnerships that don’t deliver Distributor (or their agents) decides to push another product over yours (not just competitive) because it makes them better margins or is easier to sell Your distribution partners squeeze margins Retail/Distribution channels are locked-in by competitor or for other reasons You can’t close key customers in a concentrated market (few, but big, customers)
05 MARKET RISKS WHAT IF…. Customers don’t actually buy your product (perhaps because of need-feature misfit or they just prefer status quo) Segment does not materialize (you were wrong when you identified a segment of customers with shared needs) Market share falls short Competitors or substitutes block you (by distributor/retailer or customer lock-in) or there are other barriers to entry you cannot bypass Competitors launch a FUD (Fear, Uncertainty, and Doubt) campaign You just get beat by competitors or substitutes You get the pricing wrong (impact to your margin) Cost of advertising is higher than expected Marketing associated costs (such as retail rental) go up dramatically Your internal infrastructure (IT) fails
06 AFTER SALES RISKS WHAT IF… Your product has bugs Your support organization cannot handle scale or scope of complaints You receive a lot of returns Angry customers complain on social media or in the press Customers don’t re-purchase
07 FINANCIAL RISKS WHAT IF…. Your customers do not pay on-time (or at all) Your debtors call on you when you don’t have funds to pay Revenue or cost projections are off You fail to calculate tax properly Your internal accounts go awry because your accountant #epicfails You suffer from changing exchange or interest rates
09 PEPOLE RISKS WHAT IF… Your project management fails (delays or quality issues) There is key-man risk or heavy attrition You cannot get the required supply of specialized talent
10 PEST RISKS WHAT IF… There are changes to political climate or release of new legislation / standards There are macro-economic slumps / depressions There are wars, terrorism, epidemics, etc Technology advances unexpectedly away from your solution
Severity of impact Likelihood of impact high low high HAVE A CONCRETE PLAN AND MITIGATE ACTIVELY RECORD IN RISK REGISTER & DO SEMI-ANNUAL REVIEWS MONITOR ACTIVELY USING TRIGGERS AND HAVE A PRE-BUILT ACTION PLAN, BUT DON’T ACTIVELY MITIGATE RECORD IN RISK REGISTER & DO A QUARTERLY REVIEW
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