External factors play a significant role in influencing business risks. These factors include:
Economic Conditions: Changes in economic conditions, such as recessions or booms, can impact business performance. Political Climate: Political instability, changes in government policies, and regulations can affect business operations. Technological Advances: Rapid technological changes can render existing products obsolete or introduce new competitors. Social Trends: Shifts in consumer preferences and social trends can alter market demand. Environmental Factors: Natural disasters, climate change, and environmental regulations can pose risks to businesses.