Strategic and Financial Risks - Essay Example

Essman could have overlooked some financial risks. Her idea was to produce a sponge pillow used to clean the children. The probability that the products will have high demand is not certain and therefore financial implications are put at stake. The money that will be involved in international business might also attract financial risks to the company. (Blackman, 2014)

The company should have a risk retention insurance program. This is because the company will be dealing with products that catch fire easily. The international business is also full of risks and therefore the organization should always retain a reserve fund to offset some financial claims that may arise. This self-insurance is important for business growth. (Paul, 2012)

Pansy Ellen Products Inc should have various kinds of insurance coverage since it is involved in a risky business. It should have general liability insurance to provide cover for the damages, employees, and products. This is important because all these are susceptible to the risks. The company should also have property insurance to cover the building, office equipment, and inventory against fire vandalism, fire, and theft. (Mark, 2013)