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business objective 5
| Question | Answer |
|---|---|
| what are business objectives | the aims of targets thats business works towards |
| benefits of setting objectives | -give workers and managers a clear target to work towards > motivation -taking decisions will be focused on: will it help achieve our objectives? -clear and measurable objectives = help unite business to same goal -business managers can compare |
| most common objectives for businesses in private sector? | to achieve: business survival profit returns to shareholders growth of business market share service to community |
| profit? | total income of a business (revenue) less total costs -needed to pay a return to owners of business for capital invested + taken -provide finance for further investments |
| growth? | -make jobs more secure -increase salaries and status of managers -open up new possibilities and help spread risks by moving into new products and markets -obtain a higher market share from growth of sales -obtain economies of scale from expansion |
| returns to shareholders | -increasing profit (and share of profit paid to shareholders as dividends) -increasing share price |
| market share? | the percentage of total market sales held by one brand or business |
| formula for market share? | market share % = company sales / total market sales x 100 |
| social enterprise | has social objectives as well as an aim to make a profit and reinvest back into the business |
| objectives for ppl with social enterprise | -social (provide jobs + support for disadvantaged) -environmental (protect environment) -financial (make profit and reinvest back into se) |
| why do business objectives change | -has survived for a long time and owner now aims to work towards higher profit rather than survival -business has achieved higher market share and now has objective of earning higher returns for shareholders -a profit-making business in ser (survival) |
| stakeholder? | any person or group with a direct interest in performance + activities of business e.g. owners, workers, managers, consumers, gov, banks |
| owners aims? | profits, return on capital |
| managers aims? | salaries status control |
| workers aims? | income job security satisfying work |
| customer aims? | goods and services quality good value |
| community aim? | jobs clean environment safe products |
| government aims | employment taxes increasing national output |
Created by:
elisseu
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