Hazel realised that she needed to become more pro$-$active in managing her risk. She is now

considering a significant expansion of the menu by introducing a new line of plant$-$based chicken

alternatives to cater to the growing demand for vegetarian and vegan options. This strategic move

aims to attract a broader customer base and align with the increasing trend towards plant$-$based

eating. However, the introduction of plant$-$based alternatives presents inherent risks and challenges

for the diner.

She is aware of her limitations and has come to you for advice. You are to compile a report to assist

her in understanding risk management.

$3.$ Risk Identification

$3\mathrm{.}1$ Apply Key Features of Risk$-$Identification Process

$$ Identifying hazards: Look at market trends, customer preferences, and

supply chain challenges that might arise from sourcing plant$-$based

ingredients.

$$ Diverse Methods

$$ Industry Relevance:

$$ Stakeholder Involvement:

$$ Continuous Process

$$ Creativity Encouraged

$3\mathrm{.}2$ Differentiate Between Risk and Uncertainty

$$ Risk involves situations where probabilities of outcomes can be calculated.

For example, introducing plant$-$based chicken carries a calculable risk of low

customer demand, which can be partially predicted through surveys and

market analysis.

$$ Uncertainty means outcomes that cannot be predicted or quantified. The

overall impact of a future trend, such as a sudden drop in the plant$-$based

food trend, is uncertain because no data can predict its likelihood.

$3\mathrm{.}3$ Identify Risks for Diversifying into Vegan Foods

$$ Economic Risks: The cost of plant$-$based ingredients may fluctuate,

increasing operational expenses. Current research could reveal economic

pressure on plant$-$based ingredient suppliers, leading to price volatility.

$$ Competitor Risks:

$$ Supplier Risk

$$

$$

$3.$ Risk Identification

$3\mathrm{.}1$ Apply the key features of the risk$-$identification process to The Roostery

Note that marks will only be awarded for application. No marks will be awarded for

theory.

$3\mathrm{.}2$ Differentiate between risk and uncertainty by using comprehensive, practical examples

that are relevant to The Roostery.

Note that marks will be awarded for theory and application.

$3\mathrm{.}3$ After conducting further current and factual research, identify two of three of the

following risks relating to diversifying into vegan foods:

$3\mathrm{.}3\mathrm{.}1$ Economic risks

$3\mathrm{.}3\mathrm{.}2$ Competitor risks

$3\mathrm{.}3\mathrm{.}3$ Supplier risk