What are business objectives?

As entrepreneurs seek to earn profits from their businesses, the business objective of a firm will follow the objective of the owner's – which are profits. Therefore, a firm will aim to maximize their profits.

However, there may be certain entrepreneurs who may aim to profit just to survive or grow the firm. These are social entrepreneur’s who aims to improve the social well-being of society and the environment through a social enterprise.

A private sector business objective may change overtime during different business cycles. During a recession, a firm may only aim to survive as demand for goods and services decline, but as the economy recovers and grow, a business may want to expand, increase market share and maximise its profit. This will change the company’s mission statement, and business target. Sometimes, certain business stakeholders may not favour such changes as they have different objectives.

Most businesses are in the private sector, but in countries with a mixed or planned economy, the number of public corporations (public sector) could be significant. These businesses have different business objectives as their main aim is to serve the public.

The key business objectives of a business are growth, to increase profit, market share, and survive.

RELATED QUESTIONS

1. Why does firms in the public and private sector have different business objectives?

2. When does a firm change its business objective and why?

3. Why does stakeholders have interest in business objectives?

RELATED CONCEPTS

1. Profit

2. Growth

3. Survival

4. Market Share

5. Private Sector

6. Public Sector

7. Economic Systems

RELATED POST

1. What are the different economic systems?

2. Who are business stakeholders?

PAST YEAR QUESTIONS

1. Define ‘business objective’. (2 marks) May/June 2021/13

2. Define ‘profit’. (2 marks) May/June 2020/12

3. What is meant by market share? (2 marks) May/June 2018/11

4. Identify two reasons for a business having business objectives (2 marks) May/June 2018/12

5. What is meant by business objectives? (2 marks) Oct/Nov 2018/11

6. What are the different objectives of each stakeholder groups? (6 marks) May/June 2020/12

7. Identify and explain two objectives a firm might have if it was in the private sector? (4 marks) May/June 2019/11

8. Identify and explain two reasons why a business's objective might change overtime? (4 marks) May/June 2019/12

9. Outline two reasons why profit might be important to SBG. (4 marks) Oct/Nov 2021/11

10. Identify two objectives for a business organisation in the public sector. (2 marks) May/June 2022/11

11. Explain two possible reasons why profit might be important to TJM (6 marks) May/June 2022/13

12. Identify two reasons why businesses need objectives. (2 marks) May/June 2022/13

13. Outline two reasons why having objectives might be important for a business (2 marks) Oct/Nov 2022/13

14. Identify two reasons why a business might change its objectives. (2 marks) Oct/Nov 2020/11

15. What is meant by ‘social enterprise’? (2 marks) May/June 2019/12