Know where you're exposed
Risk analysis means spotting what could go wrong before it does. Every business faces risks: one big customer leaving, a price shock, a broken machine, illness. Naming them is the first defense.
Spread your bets
If all your income comes from one customer or one product, you're fragile. More income sources, some savings, and a little insurance make you resilient — a shock bends you instead of breaking you.
Example
A seller supplying only one restaurant loses everything if it closes. Adding two more buyers means losing one hurts, but doesn't end the business.
A maize farmer who once lost everything to a dry season now runs three smaller income streams: maize, poultry, and weekend transport with his pickup. Each earns less alone than maize once did — but no single bad event can now empty the household, and lenders treat him differently because of it.
A caterer earned 80% of her income from one company canteen contract. When the company relocated, she nearly went under in a month. Rebuilding, she capped any single client at a third of revenue, kept a two-month expense buffer, and treats every renewal letter as a reminder, not a guarantee.
Practice
Why is depending on one big customer risky?
If they leave, you lose most or all income at once — no cushion.
Name two ways to reduce risk.
Spread income across more customers/products, and keep a savings buffer or insurance.
List your income sources and mark what share comes from your single biggest customer.
If one customer is more than about a third of your income, that's a concentration risk — start building a second or third buyer.
Open the Risk Assessment and answer honestly. Which answer, improved by one step, would lower your score most?
Usually your weakest area — a thin savings buffer or a single customer. Fixing the lowest-scoring answer first gives the biggest gain.
