Changes in business aims & objectives

As a business grows in size and evolves its…

objectives can change, these objectives are often influenced by various internal and external factors

The changes are often necessary to ensure that the business…

remains competitive, profitable, and compliant with regulations

Factors which cause business objectives to evolve

• Market conditions - such as competition, demand, and changing consumer price sensitivity can have a significant impact on a business’s aims and objectives

• Technology - a business may shift its focus from traditional brick-and-mortar retail to online retail as technology allows for a more cost-effective way to reach customers

• Performance - if a business isn’t meeting its sales goals in an area, it may change its objectives to try and improve its financial performance. In some cases, this may involve retrenchment (moving out of existing markets)

• Legislation - a company may need to shift its focus to comply with new regulations or capitalise on new opportunities created by changes in legislation

• Internal reasons - factors such as changes in management or the company culture can also influence a business’s aims and objectives

How business aims & objectives often evolve

• Focus on survival or growth - a start up may initially aim to survive by breaking even and becoming profitable, as the company grows and becomes more established its objectives may change to focus on growth

• Entering or exiting markets - a company may decide to enter a new market to expand its customer base or to diversify its products. Contrary, a business may decide to exit a market if it’s not profitable

• Growing or reducing the workforce - a growing company may need to hire more employees to supports its expansion or reduce its workforce to cut costs or streamline operations

• Increasing or decreasing product range - a company may increase its product range to expand its customer base or to stay competitive in the market. Alternatively, a company may decide to decrease its product range if certain products aren’t proving to be profitable