Commercial risks

Market (commercial) risks are related to the costs and prices of project inputs and products and the size of the market. Table 15 provides a matrix of these risks. In this instance, too, some mitigation strategies require a consistent policy to be developed and followed country-wide (e.g. maintaining proper balances between current accounts and goods and services accounts). 

Commercial risk that is connected to changing market conditions (for example the price of natural gas for various reasons). 

The commercial risk depends on the tariff policy, transit expenses and cost of energy resources at final consumer. Incomes that can receive the producer and the transit countries, in many ways depend on a delivery distance and the transit tariff. 

It is believed that the technical risks in terms of energy security at present are outweighed by political and commercial risks, which constitute the main challenge to the security of the region. The immediate recommendations are ... 

Efforts should be directed towards initiatives that reduce the political and commercial risks... 

Allen Clamen Yes, the expected value of an idea can indeed be adjusted by its probability of success based on both technology and commercial risk. The technology risk associated with a particular idea can be estimated based on a number of variables that have been validated by past experience. 

Commercial risk refers to the market, i.e., facts that could endanger the intended market position (lack of sales infrastructure, key customer acceptance, etc.). EHSA risk covers all issues related to product safety, environmental concerns, etc. 

Gas concentration must be specified and demonstrated to be achieved. There are three methods for control and monitoring available. There are direct methods involving infrared analysis or gas chromatography. However, indirect methods are more robust and for that reason ought to be specified either on their own or alongside direct methods. Use of a sensitive, vulnerable, direct method of gas concentation without indirect backup in large-scale ethylene oxide sterilizers is usually seen to be an unacceptable commercial risk. 

Maintaining new product information as trade secrets can pose commercial risks when others may seek patents if they develop similar products. Exactly the extent of this risk is uncertain. Section 102(g) of the Patent Act, 35 U.S.C. 102(g), provides that a person may obtain a patent over an invention, even if he was not in fact the first to invent, if the first inventor has concealed or suppressed the invention or otherwise not acted diligently. Thus, a second inventor may be able to obtain patent protection over an invention when the first inventor has relied on the trade secret doctrine for his protection. The reported cases to date have not addressed the question as to whether the second inventor, having obtained a patent, can thereafter sue the first inventor for infringement. 

It may seem that these distinctions have been lost on the way, at least in the business of commercial risk analysis and management. For the purpose of this paper, the implication is that we have lost one potential way of addressing the wildness in wait , for which there was no room in the hygienist utopia of Castels. However, this form of uncertainty, as an expression of possible wildness , can be rehabilitated by means of acknowledging the distinctions of order, as depicted by the left side of Cynefin (Fig. 1). 

Bad luck. As real calamities such as political risk or natural disaster can and should be insured against, this should rather be described as the occasional, unfortunate consequence of excessive risk. Some degree of technical risk is inevitable for developing technologies, without which a technically based enterprise is anyway unlikely to flourish. The same goes for commercial risk, which is necessary to seize opportunities. The key is to have a considered risk management... 

Pre-project work starts with an idea or concept which the client has decided to develop. The concept and design of the final process plant progresses in cycles of increasing definition. Initially a study is made, in which the concept is technically developed, optimized, and analysed as a business proposition the analysis includes considerations of technical and commercial risk, capital and operational cost, product value, and return on investment. A report is prepared if the conclusions are acceptable to the client, he may authorize the implementation of the project. Alternatively, he may authorize more funds for further conceptual development, or, of course, abandon the concept. Authorization of the implementation of the project invariably implies the expectation of a plant which will perform within specified limits, and be built in accordance with certain standards, within a promised budget and schedule. 

The first step in the process is risk identification, which is accomplished by review of the proposal/study by suitably experienced experts using well-considered checklists. These must embrace all facets which may affect the project outcome, such as plant feedstock quality, process reliability, mechanical reliability, potential foundation problems, operational hazards, environmental impact, equipment costs, construction costing and labour, statutory requirements, contractual and legal problems peculiar to the country of construction, eventual decommissioning costs, and so on. Risks due to operational hazard are generally treated separately from commercial risk, and will be discussed in Chapter 12, but they are obviously an essential part of the overall process. 

Taking advantage of potentials for collaborations to systematically combine interfaces and capabilities is another means to optimize total operational costs. Any commercial risks need to be assessed beforehand. Ultimately, the range of services can usually be expanded. Thinking outside of the box is indispensible to taking this initial step toward a value added network. Individual operations and activities must be examined critically in order to be able to draft contracts expediently and ealculate costs realistically. The correlation between one s own and one s network partners success must always be borne in mind. 

Thus, the predictions are 2.6 coUisions per annum, 1.1 derailment per annum, other movement accidents 0.2 per annum (or twice each 10 years), 1600 accidents resulting in commercial risk only each year, 2900 times nothing will happen though the hazard will exist (or in other words the accident will be averted) and 0.00088 level crossing accidents per annum. 

If the analyses of the potential damages clearly reveal that only material damage and no personal damage occurred it wouldn t be classified as safety relevant function. It would be classified as severity class SO and no further risk assessment is needed. ISO 26262 those not define further requirements for such a function, such commercial risks must be controlled by means of other measures or standards (Fig. 4.13). 

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