Business Objectives (Edexcel IGCSE Business): Flashcards
Exam code: 4BS1
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Define a business objective.
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Cards in this collection (22)
Define a business objective.
A business objective is a target that guides a business's operations and drives its growth.
What does the acronym SMART stand for?
Specific, Measurable, Achievable, Realistic and Time specific.
Objectives are most useful when they are : specific, measurable, achievable, realistic and time specific.
Objectives are most useful when they are SMART: specific, measurable, achievable, realistic and time specific.
Name three financial objectives a business might have.
Survival, profit, sales, market share, and financial security.
Define market share.
Market share is the proportion of a market controlled by a particular company, brand or product.
Why might survival be a business's main objective?
During challenging conditions or strong competition — e.g. Camping Sous les Étoiles focused on survival during the 2020 pandemic.
True or False?
Financial objectives are especially important to private sector businesses.
True.
Financial objectives matter most in the private sector, as owners usually want to make money.
What is a non-financial objective?
A non-financial objective is a target not directly connected to making money.
Name three non-financial objectives.
Social objectives, personal satisfaction, challenge, and independence and control.
Wanting the freedom to make their own decisions gives some entrepreneurs the objective of independence and .
Wanting the freedom to make their own decisions gives some entrepreneurs the objective of independence and control.
True or False?
Only public and voluntary sector businesses ever set non-financial objectives.
False.
Many profit-making businesses also set non-financial objectives to complement their financial ones.
Give two internal reasons a business's objectives might change.
As it grows (survival → profit maximisation), when owners retire, when a new leader arrives, or when performance changes.
As a business grows, its objectives may change from to profit or sales maximisation.
As a business grows, its objectives may change from survival to profit or sales maximisation.
How might increased competition change a business's objectives?
It may shift from maximising profit to maintaining market share — e.g. Maxi's Fahrschule cut prices to keep learner drivers.
Name the three external factors that can change business objectives.
Market conditions, technology, and legislation.
True or False?
New legislation can push a business towards social objectives such as reducing its carbon footprint.
True.
Environmental regulations raise focus on social objectives — e.g. the 2023 EU single-use plastics ban affected SEF Packaging.
How can new technology change a business's objectives?
New production technology can support profit maximisation as costs fall, and better e-commerce can boost sales.
A retiring owner may change their objective from increasing market share to maintaining financial .
A retiring owner may change their objective from increasing market share to maintaining financial security.
Define legislation.
Legislation refers to laws or regulations that compel individuals or organisations to behave in a desired way.
True or False?
A business's objectives always stay the same throughout its life.
False.
Objectives change over time due to internal factors (growth, new leaders) and external factors (competition, technology, laws).
In a fast-growing market, what objectives are businesses likely to pursue?
Maximising sales and profits.
New laws may increase business , forcing a firm to focus on increasing sales volumes.
New laws may increase business costs, forcing a firm to focus on increasing sales volumes.
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