A starting point for assessing the potential return and risk of your business is

Question

A starting point for assessing the potential return and risk of your business is to review general background information about the potential customers that may someday purchase your services. Go to www.cia.gov and review the information provided in the "World Factbook" Country Profile for South Korea (SK). Question 1: Identify the type of information listed here that may have some influence on the return and the risk of this business (of course, always explain WHY this information is relevant for your firm).

Explanation / Answer

*Assuming a software as a service business here for the question

South Korea has a democratic based government. It is located at Eastern Asia surrounded by Japanese sea, the Yellow Sea and North Korea.

Different factors which may influence the return and risk for the business are

1. Location: Its is located in East Asia and surrounded by sea from 3 sides. It is also a flood-prone area and has risks of floods. It has a history of big floods and thunderstorms. Few big flood and storm like one in 2011 and 2014 which took lives of many and impacted business in a major way. So it's always a risk for a business and may impact on the return in 3rd and 4th quarters.

2. Population: SK is 70% of mountain area and hence all the population is concentrated in the city. Age wise 46% of the population is in the working class i.e 25 years to 54 years of age. This is a good point in terms of targets people with technological solutions. We will also get a good amount of working professionals for the jobs.

3. Administrative divisions: It has 9 provinces, 6 metro cities, and 1 special city. This proper division will be helpful in target marketing and expansion of business

4. Economy Growth rate: SK has a growth rate of 2.3% which is slower than many developing countries, however it is at par with few of the developed country. However, from the business point of view, it could be seen as a long-term risk as slow growth rate could be turned into the recession.

5. Communication: Communication number for fixed line and mobile number are good. The broadcast communication is also up to the mark and this can be beneficial in marketing and promoting the business and impact to return in a positive way.

6. Transportation: SK is very good in terms of transportation facilities and which surely positive in terms of return to the business. It will help for transportation of people and goods in some cases. It will be easy to establish new work places.

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