Business Aims and Objectives

What is the business for?

Every business is trying to achieve something. Its overall, long-term goals are its aims, and the specific targets it sets to get there are its objectives. Some objectives are about money; others are not. This module sorts the two and explores why different businesses want different things.

Aims and objectives

Four ideas underpin the whole topic:

Aim or objective?

Which of these is an OBJECTIVE rather than an aim?

• Increase sales by 10% over the next year
• To become a well-known brand one day
• To be a successful business
• To make the world a better place

Match each financial objective

Two kinds of objective

Objectives fall into two broad groups. Most exam answers need you to recognise which is which.

Which are non-financial?

Select the TWO objectives that are NON-FINANCIAL.

• Giving the owner personal satisfaction from running their own business
• Reducing the business's impact on the environment
• Increasing profit by 15% this year
• Growing the business's share of the market

Complete the definitions

A business's overall goal is its _____, while a specific, measurable target is an _____. Objectives measured in money, such as profit, market share or _____, are called financial. Objectives not about money, such as the owner's personal _____, or a _____ cause that helps the community, are called non-financial.

Why do objectives differ?

Not every business wants the same thing. Objectives differ because of the size of the business, its sector, the owner's motives and its stage. A brand-new start-up often puts survival first; an established firm may chase profit or growth; and a social enterprise may put its cause above profit.

Different businesses, different goals

Choose the most likely main objective for each business.

• A brand-new coffee van has just opened and money is tight. What is its most likely main objective?
• A charity-run cafe puts any surplus into training homeless people. What is its main objective?
• An established, profitable bakery chain wants to open ten new branches. What is its main objective?

Why survival first?

Why might a brand-new business aim to SURVIVE rather than to maximise profit in its first year?

• Cash and customers are uncertain at first, so simply staying open comes first
• New businesses are not allowed to make a profit
• Profit does not matter to any business
• Survival and profit mean exactly the same thing

Aims against objectives

Tap the TWO statements that are correct about business objectives.

• An aim is a broad goal, while an objective is a specific, measurable target.
• Every business has exactly the same objectives.
• A social objective is an example of a non-financial objective.
• Profit and survival are non-financial objectives.
• A business's objectives can never change as it develops.

First things first

A new sandwich shop grows over several years. Put its typical main objectives in the order it would usually pursue them.

• Survive the difficult first year
• Break even, covering all its costs
• Make a steady profit
• Grow by opening a second shop

Advise the founders

Two friends are starting a small independent bookshop. They want to make a living, but they also care about supporting local authors. Explain what objectives they might set and why their objectives could differ from those of a large supermarket chain.

• Identify one financial objective the bookshop might set, and why
• Identify one non-financial objective the bookshop might set, and why
• Explain why a new, small business might focus on survival at first
• Explain why the supermarket chain's objectives could be different