Business Aims and Objectives

In The Assignment Brief Scenario... Finally, identify and summarise the aims and objectives of your two selected retail businesses. To do this you should: Describe the aims and objectives of the two retail businesses. Explain how and why the two retail businesses use these aims and objectives.

To take the ball forward past the opposition The aim of a football game is…TO WIN! So what are the objectives? To defend To train well To take the ball forward past the opposition To score To use tactics to beat the opposition To stay onside To stop the goals To communicate

Business aims and objectives – what we know already The main aims of businesses are: To survive To maximise profits To expand To provide quality goods and services Different types of organisation have different objectives: Private sector businesses exist to make a profit Organisations in the public sector exist to provide public services

Let’s now look in more detail at business objectives Some objectives are financial so can be easily measured e.g. level of sales Some objectives are harder to measure e.g. provide customer satisfaction What is the benefit of being able to measure an objective?

Maximisation Businesses may try to maximise the following: Sales – to sell as many goods as possible Profits – high sales, low costs Efficiency – being efficient enables the business to keep its costs down Market share – the percentage of all the sales in the market owned by the business Maximisation can conflict with other objectives e.g. customer satisfaction – how?

Satisfying Some businesses do not try to maximise but instead set realistic targets and then are satisfied when targets are reached This is true of most new businesses

Break even point is where sales = costs Survival Survival means just being able to keep trading This is the main aim of most new businesses To survive, a business must make enough sales to cover its total costs When this happens, it is called breaking even i.e. Break even point is where sales = costs After break even point, the business starts to make a profit

Non-financial objectives Independence – being able to work for yourself and make your own decisions Customer satisfaction– with the product or level or customer service offered – encourages repeat trade Reputation – word of mouth advertising is important in some industries e.g. garages Provide a public service – this is the objective in the public sector Customer satisfaction - eg. Call centres carry out analysis of how quickly calls from customers are answered……the Automobile Assistants. Carry out regular surveys of members and collect customer’s views of service performance Repeat trade – loyalty of customers vital to business – eg service sector