Learn to embrace risk in your business

It’s human nature to avoid risk. We all do it every day, every time we cross the street is an assessed risk.

To start in business you need to be prepared to embrace risk – will my business idea work? Is there a gap in the market? Have I identified and prepared for what could go wrong?

You’ll be risking your time, energy, money and/or reputation in order to establish your business.

Business owners need a mindset that’s willing to face intentional, focused risk (not crazy, impossible risks) in order to move forward, to keep pushing for better.

Positive vs. Negative Risks

When most people think of potential events that could impact their business, they typically think of negative risks — bad things that will cause your business to suffer and cost you money if they happen, such as a natural disaster or cyber security attack.

But events that would be good for your business can also happen— these are called positive risks. For instance it could be a new revenue stream or an opportunity to improve your processes by applying for a grant.

John Scott operates Eezybeez, a bee-keeping business in Gundary, southeast of Goulburn.

A positive risk I’ve taken in my business was starting in beekeeping education.

“There was a bit of capital involved, I had to develop my courses and I had to buy projectors. Now I’d say that beekeeping education is the primary focus of our business.”

“We’ve also decided to move to an acreage and build a large shed, so there was a risk in that financial investment. But they’re things that are meant to improve our business and the service that we give to people coming to do our workshops.”

“The biggest negative risk to my business would be someone getting stung during one of my courses and having an anaphylactic reaction. I mitigate that by having insurance and providing good quality bee suits for people to wear. I make sure that everyone’s bee suit is properly zipped up before we open a hive. And I also have an epipen on standby in case someone does have an anaphylactic reaction and of course we will call triple zero.”

Risk-embracing mindset

Here are four principles for helping you to become more comfortable with risk:

1. Failure is an opportunity to learn. You’ve got to take chances, make mistakes and learn from your mistakes in order to really grow.
2. Most people avoid change, but life is always changing and it’s up to you to decide which direction you want to go. Take a risk to deliberately move forward, rather than drifting along with whatever changes are taking place.
3. Practise taking small risks first so that you can experience some small wins on the way. This will give you the courage to take on bigger risks later.
4. Surround yourself with people with a growth mindset who can help you to see what you’ve gained rather than what you’ve lost or missed by taking the risk.

You can’t allow a fear of failure to hold you back. Commit to raising your risk tolerance and seize opportunities for growth!

From risk to resilience

Once you have identified your business’ positive and negative risks and taken on a risk-embracing approach, shift your focus from risk management to strategic resilience.

What do you do if something goes wrong?

Instead of spending time acting defensively and trying to avoid the inevitable disasters that will occur, sit down and develop a simple business resilience strategy. Focus on the future, consider how your business can grow and adapt, look for opportunities for a competitive advantage and address the potential for disruption and uncertainty. Be creative and innovative!

John says “We’ve reduced the huge negative risk of climate change to our business by having different revenue streams. For instance, we sell bees, beekeeping equipment and honey. I’m also going out and giving a lot of beekeeping talks to places like garden clubs. It’s a way of making money but also a form of marketing.”