1.5 Business objectives and stakeholder objectives Flashcards
(17 cards)
business objectives
Specific, measurable targets that a business sets to help achieve its aims.
Survival
The short-term objective of a business to continue operating, especially important for new or struggling businesses.
Growth
Expanding the business in size, sales, or market share.
Market share
The proportion of total sales in a market made by one business.
Market Share (%) = (Sales of the business / Total market sales) × 100
Customer satisfaction
Meeting or exceeding customer expectations to encourage loyalty and repeat purchases.
social enterprise
has social objectives as well as an aim to make a profit to reinvest back into the
business.
Stakeholders
Individuals or groups with an interest in the operations and success of a business.
Internal stakeholders
Stakeholders within the business, e.g., owners, managers, employees.
External stakeholders
Stakeholders outside the business, e.g., customers, suppliers, government, local community.
Stakeholder conflict
A situation where different stakeholder groups have competing interests.
Give two objectives a business might have.
Profit maximisation and increasing market share.
Why is survival important for a new business?
Because it must cover its costs and establish itself before it can grow or make a profit.
How is market share calculated?
(Sales of the business ÷ Total market sales) × 100.
Name two internal and two external stakeholders.
Internal: Owners, employees. External: Customers, government.
What might be a conflict between shareholders and employees?
Shareholders may want to cut costs (e.g. lower wages) to increase profits, but employees want higher pay and better working conditions.
What is a social objective a business might have?
Reducing carbon emissions or using fair trade suppliers.
Why do businesses need objectives?
To provide direction, measure success, and motivate employees.
