Risk Management Register: Risk | Description | Owner | Source | Likelihood of Occurrence* | Severity of Impact* | Controllability* | Macroeconomics Risks | Economic downturn could pose risk to sales development. | Accounting Team/Sales Team | Poor economy, not enough jobs, people not purchasing as much | High | High | Low | Consumer Demand Risks | Not being able to respond to consumer wants/demands quickly enough, leading to short-term revenue loss | Marketing Team | Consumer interests change, other companies offer newer/better product | Medium | Medium | Medium | Industry Consolidation Risks (bargaining power) | Decreased bargaining power, price wars, inflated discounts, limited space within retailers | Sourcing, …show more content…
These risks could potentially seize production, which could pose for interruptions in meeting customer demands, resulting in the company not reaching specified financial goals, overall affecting their bottom line.
A2. While it is important for the company to know potential risks to the organization, it is equally important for them to be able to identify the source of each risk. In the Adidas Group, macroeconomic risks occur when there are sudden economic downturns, especially in locations where the company has a strong market presence, hindering sales development. Consumer demand risks for this group occur because as product demands change, it takes the company on average 12 to 18 months to obtain new products. If consumer demand changes too quickly, this can result in revenue loss. Over a period of time, if the consumer demands are not met in a timely fashion, this can be detrimental and critical to Adidas Group. Industry consolidations risks result in decreased bargaining power and price wars. It could also lead to inflated discounts on Adidas products as well as limited space within the retailers. This risk comes from market consolidation and strategic alliances. Political and regulatory risks- trade policies in particular, stem from restrictions on importing, tariffs, and other factors that could influencing or disrupt the free flow of goods within