Anosmia refers to no sense of smell, hyposmia is a reduced sense of smell. Smell is also responsible for a large proportion of taste so things tend to taste bland if the sense of smell is reduced. The area of the nose responsible for smell, the olfactory cleft, is a relatively small area right at the top of the nose. If this area of the nose is blocked, as may be the case with nasal polyps, then smell is reduced.
Other than nasal blockage the nerves responsible for smell (olfactory fibres) can be damaged by viral infections or head injuries. If there is no clear cause a scan of the sinuses and front of the brain is recommended to ensure there is no growth around the nears such as a meninigioma or olfactory neuroblastoma.