Business Objectives

12682
Flashcards by 12682, updated more than 1 year ago
12682
Created by 12682 almost 6 years ago
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business / economics objectives revision

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Question Answer
Why do businesses set objectives? To be able to work towards a business goal Business objectives = small steps towards business goal
Profit Maximisation Process that a business undergoes to determine the best output and prices - to create high income and profit
Sales Maximisation Business attempts to sell as much as possible without making a loss
Satisficing Reaching minimum requirements to fulfill a goal / objective
Survival To make enough income to be able to cover costs so that the business is not making a loss
Market Share Portion of a market - controlled by a particular business
Cost Efficiency Carrying out production in a better way in order to decrease costs - make them more efficient
Return On Investment A measure of profitability - shows whether a business is using its resources efficiently
Employee Welfare A business has to provide various benefits to ensure the employees welfare - looking after their employees (health and safety, wages)
Customer Satisfaction How products / services meet customer expectations and needs
Social Objectives Desired outcome for a business - ensure that there is no negative effects for the community / society - Business may have extra costs to use products that don't harm the enviroment
Reason for profit maximisation : To create a positive cash flow - create profit for the owners/business
Reason for sales maximisation: To achieve a rapid growth of market share - be able to be the market leader
What objective would a business wanting to meet customer expectations set? Customer satisfaction
What objective would a business wanting to carry out production more efficiently set? Cost efficiently
What objective would a business that wants to make enough income to cover costs set? Survival
What objective would a business set when it intends to reach minimum requirements to fulfill and objective / goal Satisficing
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