Some businesses aim is to sell as much of their service or product as they possibly can, or aim to beat sales of rival companies by either lowering their prices or providing better quality of services or goods. Thus providing a highly competitive business.
Businesses sometimes will aim to provide charitable or voluntary services, services that the customer does not have to pay for.
But all businesses such as the Body Shop aim to be environmentally friendly.
In order to achieve these aims a business needs money for;
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Raw materials – for example. Shampoo, conditioner, hair dyes perms etc for a hairdresser.
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Tools and machinery – e.g. scissors hairdryers etc.
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Wages/ salaries – for staff e.g. in a large factory you may need security, cleaners, cooks if canteens are available, production workers managers etc.
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Power – money for heating, lighting, water and telephone
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Premises – money for rent, leases or mortgages
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Additional costs – such as advertising transport for employees (company cars) flight travel for international companies, transport of goods and raw materials and many, many more.
To cover all of the above costs a company must be able to sell its services or goods to its customers. The money received for these sales is called revenue or income if the revenue is greater than the cost of a company is said to be making a profit. If less then the business is making a loss. Businesses which make long-term losses will eventually cease to trade, as they will be unable to pay their bills.
Objectives
In order for a business to achieve its aims it must set realistic objectives, for example. If a business such as Sainsburys aim is to make profit:
In order to assess whether a businesses has met its objectives it must monitor and evaluate its performance on a regular basis and make appropriate changes. Objectives must be realistic the best objectives are said to be SMART.
S – specific. I.e. provide five new products over the next six months.
M- Measurable. It would be reasonably simple to prove whether the business has offered five new products for sale over the previous six months.
A – Agreed. All managers, suppliers and manufacturers must be in agreement.
R – Realistic. Can the business easily offer five additional products.
T – Time constraints. Selecting a time scale gives and optional to check whether targets have been met and how successful they were.
EasyJet
EasyJet’s mission statement is:
To provide our customers with safe, good value, point to point air services. To effect and to offer a consistent and reliable product and fares appealing to leisure and business markets on a range of European routes. To achieve this we will develop our people and establish lasting relationships with our suppliers.
Sainsburys
Sainsburys mission statement is:
Our mission is to be the consumer’s first choice for food, delivering products of outstanding quality and great service at a competitive cost through working ‘faster, simpler and together’.