Final answer:
Eddie is practicing risk management by identifying and preparing for potential problems that could harm his company. This involves assessing risks, determining their impact, and implementing strategies to mitigate them.
Step-by-step explanation:
Eddie, as a small business owner, engages in an important proactive management process known as risk management. By identifying potential problems that could harm his company and taking steps to prepare for them, he is essentially assessing the various risks his business might face and developing strategies to mitigate or manage those risks if they were to occur. This ongoing process involves analyzing potential threats, determining their likelihood and impact, and implementing plans to avoid or minimize the damage caused by these threats. Examples of risk management strategies include purchasing insurance, implementing safety protocols, creating contingency plans and maintaining emergency funds. This practice is crucial for any business to ensure its longevity and stability.