Please answer the question and use some theory Envelope-It Ltd. is a UK-based supplier of envelopes made from recycled materials. They receive used paper from across Europe (which they have to purchase), process it into envelopes, and sell their products across the globe, although the vast majority of their sales are to European customers because of the (tariff) free movement of goods afforded by membership of the EU. On a whim, the Sales Director made a tender via the UK Government’s ‘Contracts Finder to supply all central Government departments with all of their envelopes. It came as a surprise to the managers at Envelope-It Ltd. when they won the contract. They have yet to sign any contract and so have a few weeks to decide whether they want to proceed. They can either proceed with the contractor if they wish, withdraw without any penalty. If they proceed, this would increase sales by 20% but Envelope-It Ltd. would have to cut ties with all existing customers – the UK Government would become the sole customer of Envelope-It Ltd. It may be possible, in time, to scale-up operations to sell to others but this would require new premises, new staff, etc. and so isn’t a short-term possibility. Envelope-It Ltd. has a ‘moderate’ risk appetite. The management has approached you as the Risk Manager of the company to write a memo identifying and critically analyzing the (adverse and beneficial) risks, and proposing risk responses, in respect of the two options. The options are to proceed with the contract, and not to proceed (retain the status quo). Whilst you are expected to discuss BREXIT, management wants a comprehensive analysis that explores themes well beyond BREXIT. You are required to include risk heat maps as/where appropriate.
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