more business Flashcards
What is the the meaning of private enterprise and what are their objectives
meaning = most businesses are owned privately by individuals or groups of individuals
they are private sector of businesses
objectives = maximise profit
what is the meaning of a social enterprise and what are their objectives
meaning = some organisations are non-profit making
eg. charities
clubs and societies exist for reasons other than profit
objectives = non-profit organisation
what is the meaning and objective of a public enterprise?
meaning = some goods and services are provided by organisations owned by central or local government
eg. healthcare, education
objectives = better standard of living
state all the stakeholders
entrepreneur/owner
customer
employees
manager
financiers
managers
suppliers
the local community
the government
customers and their objectives
the person who buys the goods and services that businesses sell - consumers
could be individuals or firms
objective: cheaper price, high quality products
employees
a person who works in a business
objectives: salary, training, connection, security etc
manager
person who help to run business. they are often employed to run the different departments in a business such as marketing, production, finance and human resources
objective = promotion, salary
financiers
company or individual who lends money to the business
objective = interest/ firms able to repay debt
suppliers
businesses that provide raw materials, parts, commercial services and utilities, such as electricity and water, to other businesses
objective = sales revenue, good relationship, prompt payment and regular orders
why do most businesses have an impact on the local community
most businesses are likely to have an impact on the local community, there may be more jobs and possible higher pay
what impacts do businesses have on the governemnt
taxes from businesses and their employees are used to finance government spending
what is the importance of clear objectives
- employees need something to work towards. objectives help to motivate people
- without objectives owners might not have the motivation needed to keep business going
- they help to decide where to take a business and what steps are necessary to get there
it’s easier to asses the preformance of a business if objectives are set
- if objectives are achieved it could be argued that the business has preformed well and it gives a sense of satisfaction
state all financial objectives
survival - at the beginning owners face competition, lack of experience and maybe shortage of resources, so its crucial for the business to survive
profit - most businesses aim to make profit because their owners want a financial return, shareholder would like to gain large dividends
sales - this is because businesses with large volumes of sales may enjoy a number of benefits, the higher the sales the higher the revenue
increase market share - businesses often want to build a large market share to be able to dominae market as a result charge higher prices, large market share also have higher profile in the market therefore it’s easier to launch new products
financial security - aim to make enough profit to have financial security - profit satisficing
state all non financial objectives
social objectives - aimed to improve human being
challenge - some are motivated by challenges and starting a business can be very challenging
independence and control - some want to be “their own boss”
personal satisfaction - some owners have developed their hobby into a business
why might objectives change as a business evolves?
market conditions - a new entrant may appear in the market, a rival might introduce new products all the time or the economy may start to decline so the demand will decline
technology - as the pace of technological development increases businesses may have to adjust objectives
performance - the performance of a business is not likely to stay constant
legislation - new might have an impact on the objectives of a business, many businesses have become more socially responsible. This might be a reaction to new environment, employment or consumer legislation
internal reasons - sometimes a business might change its objectives for internal reasons like it the manager gets change then the new manager will come up with new objectives
