Reference no: EM13924126

Overall Risk Profile of the Company:

Overall risk profile of ABC Company based on current economic and industry issues that it may face are described below-

i. Adverse economic condition can affect the overall production condition of ABC Company.

ii. If there is rise in the price in raw materials and factors of production it can affect the expansion of new products.

iii. The product that will be developed will be new and other companies will take the benefit from the result experience and learning of development of new product.

iv. There is risk of loss of key personnel at any time, political adverse change and potential natural disaster can harm the company production at any time adversely

v. Different factors of porter five forces like rivalry among existing firms and threat of new entrants can make harmful effect any time on ABC Company.

vi. Other factors of five forces bargaining power of buyers and sellers as well as threat of substitute products can create threat for ABC Company.

vii. Different economic factors like inflation, reduction in per capita income, condition of GDP, GNP as well as condition of the company like employee condition, quality and efficiency of workers, internal economic policy of the company all these can create risk to the company as well as to the new project viability of the company.

viii. Overall economic condition of US is not also well. Though it was the largest manufacturer in the world but at present it is in 5^th position. Import is much higher than export. The country is selling asset as well as taking debts to maintain current living standard. The international competitors are planning to make the country completely dependent on foreign production. As a result US firms are going to lose domestic self-sufficiency, national security and leverage. This overall condition can be risky for ABC Company.