HOW DO SMALL
BUSINESSES OPERATE
Business Objectives
LEARNING INTENTIONS AND
SUCCESS CRITERIA
LEARNING INTENTIONS:
I understand the
different objectives that
businesses may be
pursuing.
SUCCESS CRITERIA:
• I can explain what a
business objective is.
• I can identify suitable
objectives for different
types of business.
• I can explain the
purpose of a Mission
Statement.
What is an Objective
An objective is something a business aims
for. It is a target or goal to be achieved.
Objectives help a business to focus on what
it needs to do to achieve its goals.
FOR EXAMPLE You have the objective to get good results in all
your subjects this year, but this will not happen by
itself – you will need to attend classes, participate
in activities, complete homework and study.
What Objectives do Businesses
Have?
There are 7 objectives that we will learn about:
• Survival
• Profit
• Providing a Quality Service
• Customer Satisfaction
• Growth
• Market Share
• Social Responsibility
Survival
• This is a key objective as all the other
objectives would be pointless if the
business did not survive.
• Survival is particularly important to small
businesses who find it more difficult to
survive due to lack of financial resources.
• When survival is threatened, the business
must focus of lowering costs and cutting
production to save money.
Profit
Private Sector businesses are usually set up
with the aim of maximizing profits for their
owners. Public and Third Sector businesses
are not.
Profit arises when income from sales is
more than the businesses costs for making
those sales.
Providing a Quality Service
This is an objective of all businesses but
particularly those who offer services rather
than goods.
It is also a key objective of Public and Third Sector
businesses, as they do not aim to make a profit but
rather to provide the best service they can within
the budget that is available to them.
Customer Satisfaction
All businesses want to have a positive image and
to be highly regarded by their customers so that
customers stay loyal to their business.
To achieve satisfaction they have to provide
high quality goods and services, have a customer
care strategy, high levels of staff training and have
good after-sales service.
Growth
Private Sector businesses are interested in
growth so that they can make more profit.
Growth can be achieved by employing more
staff, opening more branches, changing
business structure eg from a sole trader to
a partnership or Ltd Company.
Market Share
Increasing the market share of the total
number of possible customers is an
objective of Private Sector businesses. The
more customers they have, the more Sales
and Profits they will achieve.
If a business has the highest market share,
they are known as the MARKET LEADER.
Social Responsibility
All businesses nowadays are expected to show a
degree of social responsibility. This means they
have to operate in an ethical way by being seen to
be doing the right thing as regards their staff,
customers and the local community and
environment.
If a business fails to act in this way, they can be
the target of negative publicity and pressure
groups, which may have an impact on their sales
and profits.
TASK
• Complete Worksheet 7 in your jotters.
THE MISSION STATEMENT
Businesses often publish their objectives
and core values in a document called a
Mission Statement.
This document is of interest to stakeholders
because it shows what the business is
trying to achieve and how it is going to go
about this.
MISSION STATEMENT TASK
In small groups access the following websites to
find information about the organisation’s Mission
Statement and prepare a short powerpoint
presentation about this.
www.coca-colacompany.com
www.bbc.co.uk
www.rspca.org.uk
www.google.com