Explore BrainMass

Risk Analysis and Risk Strategies

How do I conduct a business risk analysis for the product detailed below?
How do I analyze the following risks and how would I manage these risks?

. Legal Environment
. Trade barrier support
. Taxation
. Ethical concerns

The country is Mexico and it is formed as a private company offering beef, vegetables and fruits to our authentic "Taste of Mexico" chain of restaurants that are throughout the USA and Mexico. Our company will offer the highest quality of beef and food supplies that are completely natural by not using any chemicals enhancement/hormones in our beef, vegetables and fruits. Our company will provide high quality beef, vegetables and fruits to natural type grocery stores as well.

I also need your help with in defining:
- Legal environment
- Trade barrier support
- Taxation
- Ethical concerns

Thank you.

Solution Preview

Please see response attached for better formatting (see below as well), and supporting documents. I hope this helps and take care.


1. How do I conduct a business risk analysis for the product detailed below?

There are a number of ways to approach risk analysis, but the dominant model in most MBA programs falls under the category of "rational" models. In these models, risk analysis and decision-making relies as much as possible on objective and quantifiable data. There are other models, which rely more on historical and qualitative information, and in these models it is easier to utilize non-rational intelligence (for example, emotional intelligence). ( The truth probably lies in the middle. It is important to consider both quantitative data (i.e. Laws, tariffs, etc.) but it is also important to consider historical business trends (i.e., how well have other businesses did in the past) and qualitative information (i.e., talking to the people and to other business owners). Has your instructor suggested a certain type?

In your case, I would think that you will be collecting risk analysis information on the four areas through sources, such as websites, through me, and other sources. Often 'real" business will hire companies to complete this type of risk analysis. It is collecting as much information about the following issues in order to make a good informed business plan. It is about considering uncertainty associated with expected returns. Businesses are advised to limit their exposure and/or select high-return transactions only. Therefore, if, after you collected your risk analysis data, you found it to be a high risk business adventure, you probably would decide not to form your business or revise the business plan.

Before we look at your next question, though, I located an excellent example to look at some of the issues that you are to address (Sample - D&B Country RiskLine Report - see attached example)

2. How do I analyze the following risks and how would I manage these risks?

a. Legal Environment

Definition: The legal environment is referring to the Mexican laws (i.e., trade laws) that will affect your business adventure. Are there political barriers to trade, for example? Some countries worship ...

Solution Summary

This solution explains how to conduct a business risk analysis. It discusses how to analyze specific risks and how to manage these risks. Supplemented with four highly informative articles.