Business Studies- Unit 1- Business Aims

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Daniel Hardman.

A01- Business Aims

What is a Business Aim?

A Business Aim is a target or goal a business sets itself to achieve after a set period of time. Business aims are generally to create profit, to increase market share, survival, growth and to improve quality of a service.

Businesses use SMART Objectives- this is an acronym used to set small stepping stones used to achieve the overall business aim, as business aims and objectives motivate employees and enable the business to measure their progress towards its stated aims.

  • Specific: clearly state the precises of what is to be achieved, this makes the aim much more clear on what is set to achieve e.g. increase market share
  • Measurable: the desired outcome should be a number value that can be assessable; this makes employees more motivated as they know a specific number to work towards. E.g. increase profits by 10%.
  • Agreed: all staff are involved in discussing and approving an aim. This means that there is little room for fault as the decision has been intensively conferred. E.g. if a proposition is not approved by all parties, an alternative should be considered.
  • Realistic: the target is possible given the market conditions and the staff and financial resources available. E.g. If the business aims to gain profit during a recession by increasing its prices, this is unrealistic and therefore no in keeping with the SMART acronym.  
  • Time-bound: the target will be met within a given period of time; a commitment to a deadline helps a team focus their efforts on completion of the goal on or before the due date. E.g. the market share must be increased in to X in 12 months.
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A business objective means the undertaken activities carried out and the changes made to the business e.g. raise prices to increase profit.

Profit- The main objective of most businesses. Profit is the leftover money when the costs are taken from the total sales. It is for this         reason why sales and prices must be set as high as possible.        

The above formula means that the amount of capital raised with the costs injected into the business taken away from it. This is the reason why businesses try to cut down their ...

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