Year 1

Goods

Physical items

Services

Actions preformed by other people to aid the customer

Products

Thingd customers are willing to pay for

Why do People Start a Business?

To making profit

Meet customer need (fill gap in the market)

Add value

Why do Businesses Need to Make profit?

To survive

Business Aims

Offer high quality products

To be sustainable and environmentally friendly

To have a great image and brand

Excellent customer service

Offer a diverse range of products

To invest in the local community

Business Aims definition

What the business wants to achieve long-term in the future

Business Objectives Definition

Short-term goals that help business meet their aims

Types of Objectives

Profit

Growth

Survival

Cash flow

SMART Objectives

S - Specific, Clear and easily defined

M - Measurable

A - Agreed, Managers and subordinates are involved in setting the targetts

R - Realsitic

T - Timely, Based on explicit timescale

Profit Objectives

Wanting to become profitable

Increasing profit

Done by minimising costs or increasing sales

Growth Objectives

The larger a business grows, the more it is able to earn higher profits

Done by increasing; revenue, market share or expanding

Survival Objectives

Objectives that allow a business to continue to trade, not running out of money and closing down. Often the main objective of new busineses, during economic struggle or when there’s high competion

Cash Flow Objectives

Objectives that help improve cash flow, money is going into the business. Creates a better chance at survival

Social and Ethical Objectives

Mainly set in non-profits or as marketing or because of personal veiws

Short-Term Objectives

Short-term survival and profit but require a business to cut back on its long-term goals

Some businesses have to prioritise short-term objectives to satisfy shareholders/investors

Long-Term Objectives

Set directions of the business, they affect the big decisions that the senior managers make

Revenue

The value of sales (turnover)