In this section you should provide an analysis of the risks facing your business.  The reader of this plan will want to know that you have a realistic outlook on the ups and downs of your service.  Keep in mind that a plan with too much emphasis on potential disaster is likely to diminish the reader’s enthusiasm and cause unnecessary misgivings.  Try to find a balance between the reality of the business and not going overboard on the negative.

There are different kinds of risks faced by businesses. Some of them might be on the list below; others might be unique to your business.  Think through the main dangers your business faces and write them down in this section.  The way you intend to counter these risks will be discussed in the following section - “Contingency Plans”.

*  Competition:  Threats your business might encounter from competitive responses.

*  Pioneering:  The risks involved in introducing your new business into a market place with no competition.

*  Cycles:  Evaluate the cycles of growth and decline your business might encounter due to outside factors such as trends or technology.  

*  Slow Times: Describe the risks your business faces during slow times. This usually applies to seasonal businesses.

*  Expertise:  Let the reader know if you' re lacking resources in a certain area, in which case it might become necessary to hire someone or acquire equipment to compensate for it, such as hiring a bookkeeper or buying a 	computer.

*  Cash Flow: Explain what factors could possibly cause a cash flow crunch for your business.