Aims and Objectives of Business

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Aims and Objectives of Business

• Businesses can have a variety of objectives
  depending on
• What type of product / service they provide
• how big they are
• how they are doing
• how they have done in the past
• what the stakeholders want

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The Main Objectives

• Survival
• Profit maximisation
• Sales objectives
• Maximise sales

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Other Objectives

• Need to think what the other stakeholders may
  want
• Write down 6 stakeholders and say what their
  objectives for the business might be
• Think of Tescos when doing this

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Stakeholders
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Other objectives

• Who do the following objectives concern
• Freedom and independence
• Working conditions / training
• Better quality products at cheaper prices
• Environment looked after
• Ethical Objectives

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Exam Questions

• Go over Exam Questions

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How do you Judge Success ?

• Must think from the perspective of all
  stakeholders.
• Think of 3 examples when an owner may think that
  they have been successful but other stakeholders
  think differently

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The Conflict

• Profit versus treatment of workers
• Increase sales versus exploitation of the
  consumer
• Profit versus destruction of the environment
• Increasing sales versus maximising profits
• Survival versus quality products

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Judging the success

• Profit
• The more profit a business makes the more
  successful it is. Is this true ?
• Comparing can be very difficult.
• Business A makes 3million profit
• Business B Makes 100,000 profit
• Which Business is the most profitable ?

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Profit continued

• Need to consider
• Sales
• Business A Sales of 300 million
• Business B Sales of 1 million
• Capital Employed
• The size of the business needs to be taken into
  account
• - Rate of return on capital employed
• The Dividend Paid
• How much of the profit is paid out to the owners
  / shareholders
• - Dividend per share the amount paid out per
  share

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Sales Growth

• Another common way to measure success is to look
  at the growth in sales
• A Business that has a 50 growth in sales is more
  likely to be successful than one with no growth
• Must make sure the increase in sales are
  profitable
• Need to compare with other businesses
• Need to compare with previous years
• Need to consider the market conditions

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Judging / Measuring Business Success

• (Measuring Business Success Sheet To do)
• Measures of Success
• Survival
• Profit - dividend
• Sales
• Other Measures
• Market Share write down a definition
• Wealth Creation Write down 3 aspects of wealth
• Job Creation which stakeholders benefit ?
• Social Benefits state some examples.

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The Expro Group Exercise Page 45
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Market Share
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Homework - For next Week (Tuesday or Wednesday)

• Do on a Piece of lined Paper
• Date / Title / Name
• Data A - Mike Smith Questions 1 to 4
• Exam Questions - take your time, do it neatly,
  consider the number of marks for each question
• Use your textbook

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Homework

• Read Pages 43 43
• Page 42 - Answer questions on Peter Fowler
  Fitness Club
• Page 43 - Checklist

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Objectives Review

• What are the 3 main objectives of a Business
• Can you think of any other objectives ?
• (Think of other stakeholders when thinking of
  this question)