Aims and objectives

Note that for this topic, you don’t need to know the difference between aims and objectives — treat them as the same. Just focus on knowing the difference between financial (money-related) and non-financial (not money-related) objectives.

What is an Aim?

An aim is the main goal of a business – what it wants to achieve in the long term. Aims can be financial or non-financial.

What are Objectives?

Objectives are specific targets that help a business achieve its aim.

Key features of objectives:

Provide clear, focused targets
It’s common to have more than one
They are specific and measurable
Each business function (e.g. marketing, finance) may have its own objectives.

Financial Aims and Objectives

Financial aims and objectives are money-related goals that help a business stay successful and grow.

Common examples include:

Survival – Making enough money to keep the business open, especially in difficult times.
Profit – Earning more money than the business spends.
Sales – Increasing the number of products or services sold.
Financial security – Having enough money to cover costs and deal with unexpected problems.
Market share – Gaining a bigger percentage of sales compared to competitors.

Market share tells us how much of the total sales in a market belongs to one business. It’s shown as a percentage.

But what makes up a "market?"

A market is the collective of all companies offering the same or similar products and services. It can also be companies serving the same or similar customers. A market area can be further broken down by one or more of the following marketing demographics:

Individual product categories
Industry
Type of region (city, suburban, rural, residential, retail, industrial or commercial)
Type or size of business served (small business, large corporation, etc.)
Age (of consumers or businesses)
Gender

Why is Market Share useful?

It shows how popular or successful a business is compared to others.
Increasing market share helps a business beat competitors, attract more customers, and boost sales.
A bigger market share means the business is beating competitors.

Company C has the largest market share, earning $765 million, showing it dominates the market.

Non-financial Aims and Objectives

Non-financial aims and objectives are goals that are not focused on making money but are important for personal or social reasons. These can include:

Personal satisfaction – Feeling proud and happy about running the business.
Challenge – Enjoying the process of solving problems or achieving something new.
Independence – Being your own boss and making your own decisions.
Control – Having full control over how the business is run and its future direction.
Social objectives – Helping the community or making a positive impact on society.

Social objectives matter to businesses that want to make a positive impact, not just earn money.

Examples of Social Objectives:

Reducing pollution and protecting the environment
Donating to charity or supporting local causes
Creating jobs for people in the local area
Offering fair wages and good working conditions
Supporting education, health, or social issues

Why Would a Business Have Social Objectives?

To build a good reputation
To attract customers who care about ethical and responsible companies
To make the owner feel proud of what their business is doing
To help create a better society

The video explains Apple’s climate goals, showing their commitment to strong environmental (social) objectives.

Evaluating Aims and Objectives

Aims and objectives vary between businesses.

They depend on:

The size or age of the business
The volume of competition in the market

How Aims and Objectives Can Change Over Time

Businesses may update their aims and objectives due to:

Consumer law – Protects customers from unfair business practices.
Employment law – Protects the rights of workers.
Technology – New tools and systems that change how businesses operate.
Ethical/environmental issues – Doing what is morally right and protecting the planet.
Consumer spending – How much money people are willing to spend.
Interest rates – The cost of borrowing money.
Exchange rates – The value of one currency compared to another.
Globalisation – How businesses and markets are connected around the world.

types of organisations