Every management decision you make will affect the survival of your business, so it is important to learn how to assess potential risks before they become disastrous.

The risks involved in owning and running your own business are numerous. Small businesses may fail due to many reasons, including the following.

• Inadequate financing
• Low sales
• Lack of market knowledge
• Fierce competition
• Having a poor product or weak service
• Poor forecasting

You can't eliminate all risks but you can reduce their financial impact by implementing a risk management strategy. Your strategy will be an organised way of documenting, investigating and following through on various aspects of business operation.

An important strategy to help reduce some of these risks is to keep in regular contact with business advisers and other small business owners through a network.

Be sure to act on any advice you receive from such sources. Many people fail to listen to advice, or seek advice when it is too late to save the business.

You can find valuable small business networks to join through each state's advisory services. See the 'References' section for some links.