1.3.1

Business Aims

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Main Business Aims and Objectives

An aim is an ultimate purpose. An objective is a goal that is sought in order to achieve an aim. Some main business aims and objectives are:

Survival aim

Survival aim

  • More than half of new businesses in the UK don’t survive beyond 5 years.
  • Survival is therefore one of the biggest short-term aims for new businesses.
Profit maximisation aim

Profit maximisation aim

  • For most for-profit businesses, maximising profits is their main aim.
  • Some businesses may sacrifice short term profits in order to maximise profits in the long term.
Growth objective

Growth objective

  • For lots of firms, one of their key objectives is to grow.
  • Growth can mean lots of different things - firms can grow sales, grow the number of customers or grow the number of employees.
  • Companies may also look to expand internationally as well as expanding by introducing different products.
  • Dyson, for example, started the business by producing vacuum cleaners and have recently expanded into the market for hair dryers and electric cars.
Increase market share objective

Increase market share objective

  • Market share is the percentage of sales that a company makes relative to all the sales made in that market.
  • New companies start with a 0% market share, so increasing market share is an important goal for them.
  • Gaining market share involves stealing or taking customers from competitors or getting new customers to enter the market.

Main Business Aims

An aim is an ultimate purpose. An objective is a goal that is sought in order to achieve an aim.

Maximise shareholder value objective

Maximise shareholder value objective

  • For limited companies (both private and public), maximising value for their shareholders is a key objective.
  • Shareholders get value from a share of a company’s profits, but also by selling the shares in the future.
  • The overall value of a business (how much they could sell it for) increases depending on how well the business is doing. So, maximising profits or growing the business can maximise shareholder value.
Social and ethical objectives

Social and ethical objectives

  • Some firms make sure that they do business without having a negative effect on society or the environment.
  • Often this means firms using renewable energy sources and funding projects aimed at benefiting society.
    • For example, Jaguar Land Rover uses recyclable materials in its production of cars.
    • For not-for-profit firms, especially charities, this is usually the main goal of the company.
Customer satisfaction

Customer satisfaction

  • This objective measures how happy the customers are with the goods or service they are receiving from a company.
  • It can be a key objective because it has a large effect on both short-term and long-term profits.
  • If customers are not satisfied they won’t buy the product again and might instead buy competitors’ products.
Jump to other topics
1

Investigating Small Business

1.1

Enterprise & Entrepreneurship

1.1.1The Dynamic Nature of Businesses1.1.2Risk & Reward1.1.3The Role of Business Enterprise1.1.4The Role of Business Enterprise 21.1.5The Role of the Entrepreneur1.1.6End of Topic Test - Dynamic Nature of Business1.1.7Grade 9 - Dynamic Nature of Business
1.2

Spotting a Business Opportunity

1.2.1Customer Needs1.2.2Market Research1.2.3Market Segmentation1.2.4The Competitive Environment1.2.5Primary & Secondary Market Research1.2.6End of Topic Test - Business Opportunities1.2.7Application Questions - Business Opportunities1.2.8Exam-Style Questions - Market Segmentation1.2.9Diagnostic Misconceptions - Competition
1.3

Putting a Business Idea into Practice

1.3.1Business Aims1.3.2Business Objectives1.3.3Business Revenues & Costs1.3.4Costs - Calculations1.3.5Revenue - Calculations1.3.6Business Profits & Break-Even Analysis1.3.7Profits & Losses - Calculations1.3.8Interest - Calculations1.3.9Cash & Cash Flow1.3.10Cash & Cash Flow 21.3.11Cash Flow - Calculations1.3.12Sources of Business Finance1.3.13End of Topic Test - Business in Practice1.3.14Grade 9 - Business in Practice1.3.15Exam-Style Questions - Business in Practice1.3.16Diagnostic Misconceptions - Profit1.3.17Diagnostic Misconceptions - Company vs Business1.3.18Diagnostic Misconceptions - Economies of Scale1.3.19Diagnostic Misconceptions - Cash Flow1.3.20Diagnostic Misconceptions - Break-even1.3.21Diagnostic Misconceptions - Fixed Costs
1.4

Making the Business Effective

1.4.1The Options for Start-Up & Small Businesses1.4.2Limited Liability1.4.3Franchising & Not-For-Profits1.4.4Business Location1.4.5The Marketing Mix1.4.6Business Plans1.4.7End of Topic Test - Effective Business1.4.8Application Questions - Effective Business1.4.9Exam-Style Questions - Business Plans
1.5

Business Stakeholders

1.5.1Business Stakeholders1.5.2Technology & Business1.5.3Legislation & Business1.5.4Legislation & Business 21.5.5The Economy & Business1.5.6External Influences1.5.7End of Topic Test - Business Stakeholders1.5.8Grade 9 - Business Stakeholders1.5.9Diagnostic Misconceptions - Recessions
2

Building a Business

2.1

Growing the Business

2.1.1Business Growth2.1.2Finance2.1.3Changes in Business Aims & Globalisation2.1.4Ethics & Business2.1.5The Environment & Business2.1.6End of Topic Test - Growing a Business2.1.7Application Questions - Growing a Business2.1.8Exam-Style Questions - Business Growth
2.2

Making Marketing Decisions

2.2.1Product2.2.2Product Life Cycle2.2.3Price2.2.4Pricing Methods2.2.5End of Topic Test - Product & Price2.2.6Grade 9 - Product & Price2.2.7Promotion & Advertising2.2.8PR & Sales Promotions2.2.9Sponsorship & Product Placement2.2.10Promotional Mix2.2.11End of Topic Test - Promotion2.2.12Application Questions - Promotion2.2.13Exam-Style Questions - Promotional Mix2.2.14Place & Wholesalers2.2.15Direct to Consumer2.2.16E-commerce & M-commerce2.2.17Diagnostic Misconceptions - Decreasing Price2.2.18Diagnostic Misconceptions - Advertise vs Promote2.2.19Diagnostic Misconceptions - Social Media
2.3

Making Operational Decisions

2.3.1Job Production2.3.2Batch & Flow Production2.3.3Working with Suppliers2.3.4Effective Supply Chains2.3.5Just In Time & Just In Case2.3.6Managing Quality2.3.7Total Quality Management2.3.8The Sales Process2.3.9End of Topic Test - Operational Decisions2.3.10Grade 9 - Operational Decisions2.3.11Exam-Style Questions - Managing Stock2.3.12Diagnostic Misconceptions - JIT vs JIC
2.4

Making Financial Decisions

2.4.1Gross Profit & Net Profit - Definitions2.4.2Gross Profit - Calculations2.4.3Net Profit - Calculations2.4.4Rate of Return2.4.5Rate of Return - Calculations2.4.6Research & Financial Data2.4.7Marketing Data2.4.8Percentage Change - Calculations
2.5

Making Human Resource Decisions

2.5.1Organisational Structures2.5.2Organisational Structures 22.5.3Recruitment2.5.4Effective Recruitment2.5.5Training a Workforce2.5.6Motivating a Workforce2.5.7End of Topic Tests - Human Resources2.5.8Application Questions - Human Resources2.5.9Exam-Style Questions - Human Resources2.5.10Diagnostic Misconceptions - Owners vs Shareholders2.5.11Diagnostic Misconceptions - Internal Recruitment2.5.12Diagnostic Misconceptions - Employee Motivation

Practice questions on Business Aims

Can you answer these? Test yourself with free interactive practice on Seneca — used by over 10 million students.

  1. 1
    If Budweiser sells £10m of beer in the UK and £100m of beer is sold in total, what is Budweiser's market share?Multiple choice
  2. 2
    If Shake Shack sells £75m of chicken burgers in the UK and £500m are sold in total. What is Shake Shack's market share of the UK chicken burger market?Multiple choice
  3. 3
    Lush use only vegan ingredients in their cosmetics. What type of objective is this linked to?Multiple choice
  4. 4
    Select the business objectives:True / false
  5. 5
    Which of the following is a business aim?Multiple choice
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Diagnostic Misconceptions - Competition

Business Objectives