Business objectives:

 The aims or targets that a business works towards.

Benefits of setting objectives
Give workers and managers a clear target to work towards, helping to motivate people
-Making decisions will focus on whether it will help achieve the onjectives.
-help unite the whole business towards the same goal.
-Business managers can compare how the business has performed to the objectives and if they
were successful or not.
Business objectives of private sector:
Survival
-Profit
-Return to shareholders
-Growth
-Market share
-Service to the community.
Survival
 When a business is set up, when the economy is moving into recession, when new
competitors enter the market will make the business feel less secure. They could decide
to lower prices to survive.
Profit
 One of the most important objectives. Profits are needed to
 Pay a return to the owners of the business
 Provide finance for more investment in the business
 Without profit businesses will fail.
Return to shareholders
Helps discourage shareholders from selling their shares and helps managers keep their jobs.
 Can be increased in two ways:
 Increasing profit
 Increasing share price. Can achieve it by making profits and putting in plans.
Growths
 Usually measured by value of sales or output in order to:
 Make jobs more secure if the business is larger.
 Increase the salaries and status of managers.
 open up new possibilities and help spread the risks by moving into new products and
new markets.
 Obtain a higher market share
 Obtain cost advantages, called economies of scale
 Achieved only if customers are satisfied.
Social enterprise
 A business with mainly social objectives that reinvests most of its profits into benefiting
society rather than maximising returns to owners
Social enterprise objectives
Social- To provide jobs and support for disadvantaged groups.
-Environmental - to protect the environment.
-Financial- To make a profit to invest back into the enterprise to expand the social work they
do.
Why business objectives could change?
Businesses don't keep the same objectives forever. Here are some examples of situations
where objectives may change:
-A business set up for a number of years has the objective of survival, now the owner want to
work towards higher profits.
-A business has achieved higher market share and now its objective is earning higher returns for
shareholders.
-A profit making business is in a country with economic problems so now its objective is
survival.
Stakeholder
Any person or group with a direct interest in the performance and activities of a business.
Owners (internal)
Workers (internal)
Managers (internal)
Consumers (external)
Goverment (external)
The whole community (External)
Banks (external)
Owners features and likely objectives
Features:
-Put capital in to set up and expand the business
-take a share of the profits
-lose money they invested if business fails
Objectives
-Take a share of the profits, to get a return on money they put into the business.
-growth of the business so that the value of their investment increases
Workers features and likely objectives
Features:
-Employed by the business
-have to follow instructions of managers and may need training
-may be employed full time or part time
-Not enough work for all workers they may lose their job
Objectives:
-Regular payment for their work
-contract of employment
-job security
-jobs that give satisfaction and provides motivation
Managers features and objectives
features:
-Also employees of the business and control the work of other workers
-They make important decisions
-their successful decisions could lead to the business success and expansion.
-if they make poor decisions the business could fail
Objectives:
-High salaries because of the important work they do.
-job security
-growth of the business so they control a bigger and better know company. Giving them more
status and power.
Customers features and objectives
Features:
-Buy the goods and services provided by a business.
-Without enough customers a business will fail.
-The most successful business find out what customers want before making goods and
providing services (market research)
Objectives:
-safe and reliable products
-value for money
-well designed products of good quality
-reliability of service
Government features and objectives
Features:
-responsible for the economy of the country
-passes laws to protect workers and customers
Objectives:
-wants businesses to succeed so they will employ workers, pay taxes and increase the country's
output
-expects all businesses to stay within the law
The whole community features and objectives
Features:
-Greatly affected by business activity. Eg. dangers products might harm the population,
factories producing pollution
-Businesses create jobs and allow workers to raise living standards. Many products are
beneficial to the community.
Objectives:
-Jobs for the working population
-production that doesn't damage the environment
-sale of products that are socially responsible.
Banks
Features:
provide finance for the business operations
Objectives:
expect businesses to be able to pay interest and reply capital lent
Objectives of public sector businesses
Financial - meet profit targets set by the government

Service - provide service to the public and meet quality targets set by government

Social - protect or create employment in certain areas

Conflict of stakeholders' objectives
Stakeholders objectives can conflict with each other. Most businesses are trying to satisfy the
objectives of more than one group. These objectives can be in conflict with each other.