Why do most businesses aim to make a profit?

Profit rewards the owners for the risk they have taken. Profit can also be reinvested to help the business grow.

How might a business measure growth as an objective?

A business can measure growth by the rise in its sales, its number of outlets or its number of employees.

Why might a business set an objective to increase its market share?

A larger market share means more customers buy from the business than from its rivals. A market leader is better known and has more influence over prices.

OCR GCSE Business J204

Business Activity

Topic overview Enterprise and entrepreneurship Business planning and the business plan Sole traders, partnerships and limited companies Business aims and objectives Internal and external stakeholders Organic and external growth How business functions depend on each other

Marketing

Topic overview The purpose of marketing Primary and secondary market research Market segmentation Product design and the product life cycle Pricing methods Point of sale promotion and advertising Place and the marketing mix

People

Topic overview The role of human resources Organisational structures and ways of working Communication in business Recruitment and selection Employee motivation and retention Training and staff development Employment law

Operations

Topic overview Production processes Quality of goods and services The sales process and customer service Consumer law Business location Procurement and choosing suppliers Logistics and supply chains

Finance

Topic overview The role of the finance function Sources of finance Revenue, costs, profit and loss Break-even Cash, liquidity and profit Cash flow forecasts

Influences on Business

Topic overview Ethical and environmental considerations The economic climate Globalisation and multinational companies International branding and competition

Business Activity

Business aims and objectives

3 things to know
Component 01

Overview

Aims and SMART objectives, survival, profit, growth and market share, social enterprises, how objectives change as a business evolves, and a worked profit target.

What you need to know

Answer each one before you reveal it.

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Key term

What is the difference between a business aim and a business objective?

Key term

Name five common business objectives.

Key term

Why is survival the main objective of many new businesses?

Questions from this subtopic

Each one with the model answer underneath.

1
What is the difference between a business aim and a business objective?
Model answer
An aim is a long-term goal a business wants to achieve. An objective is a specific, measurable target that helps the business reach its aim.
2
Name five common business objectives.
Model answer
Five common objectives are profit, survival, growth, providing a service and increasing market share.
3
Why is survival the main objective of many new businesses?
Model answer
Many new businesses fail in their first few years because of low sales and cash problems. A start-up must first stay in business before it can pursue anything else.
4
Why do most businesses aim to make a profit?
Model answer
Profit rewards the owners for the risk they have taken. Profit can also be reinvested to help the business grow.
5
How might a business measure growth as an objective?
Model answer
A business can measure growth by the rise in its sales, its number of outlets or its number of employees.
6
Why might a business set an objective to increase its market share?
Model answer
A larger market share means more customers buy from the business than from its rivals. A market leader is better known and has more influence over prices.

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Business Activity

Marketing

People

Operations

Cram a whole paper in one sitting

Sort every topic into what you know and what you do not, then drill only the weak ones.

Customers may receive quality.

poorerbetterhigher

Blank Blitz makes facts automatic

Rapid timed gap-fills on the terms and numbers you need to recall without thinking.

AOwners may gain from higher profit.

BEmployees may lose jobs or face lower pay.

CCustomers may receive poorer quality.

Build It gets the exam shape right

Assemble a full-mark answer from its marking points, in the order an examiner wants them.

Aim means a broad long-term goal of a business.

TrueFalse

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Spot the fault in a statement. The traps are the mistakes students actually make.

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