Business objectives Edexcel International GCSE Business revision
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In plain words
An objective is a target a business sets itself. Without one, nobody knows what they are working towards or whether the business is doing well.
The target is not always profit, and it changes as the business does.
6 things to know
- Objectives give direction, help in making decisions, motivate staff, and let the business measure its success.
- Common objectives: survival, profit, growth, increasing market share, and providing a service to the community.
- Owners may also have personal objectives: independence, being in control, and the satisfaction of a challenge.
- Objectives change: a new business aims to survive, an established one to grow or raise profit, and in a recession survival comes first again.
- Private sector businesses mainly aim for profit. Public sector organisations aim to provide a service.
- Success can be measured by revenue, profit, market share, growth, and the satisfaction of customers, owners and employees.
Tips and tricks
- Market share is a percentage: the business's sales as a proportion of all the sales in the market.
- If a question describes the business's situation, pick the objective that fits it: just opened, in a recession, or well established.
It lands in your notebook with its questions as flashcards.
Business objectives: 5 questions and answers
These are the quiz’s questions. Do the quiz first, then come back here for the ones that got you.
Which objective is a newly opened business most likely to have?
It must first get through its early months.
A business's sales are $2 million in a market worth $20 million. What is its market share?
2 ÷ 20 × 100 = 10%.
What is the main objective of most public sector organisations?
They are run for the benefit of the public.
Why might a business change its objective from growth to survival?
When sales fall sharply, staying in business comes first.
Which is a non-financial objective?
It is about the owner's satisfaction, not about money.
Quiz
5 questions
Tap an answer and you’ll see straight away whether it’s right, and why.
Worksheet
3 questions, 8 marks. Write your answers on paper, then check them.
Business objectives
Edexcel International GCSE Business 4BS1 · 8 marks · papermunch.org
Name ______________________________ Date ______________
State two objectives a business might have.[2]
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Any two of: survival, profit, growth, increasing market share, providing a service.
Explain why survival is likely to be the main objective of a new business.[3]
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It has few customers and high start-up costs, so it may make little or no profit at first. Its first aim is to bring in enough money to stay in business.
Explain why business objectives are important.[3]
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They give the business and its employees clear targets to work towards, they guide decisions, and they allow progress to be measured against them.
Answers: Business objectives
- 1. Any two of: survival, profit, growth, increasing market share, providing a service.
- 2. It has few customers and high start-up costs, so it may make little or no profit at first. Its first aim is to bring in enough money to stay in business.
- 3. They give the business and its employees clear targets to work towards, they guide decisions, and they allow progress to be measured against them.