Task 1 In your book, write a short paragraph explaining what business objectives are

Last lesson we: Explored the ides of calculated risks Looked at important enterprise skills for entrepreneurs Completed the Creative Thinking Quiz

Aims for today Introduction to new topic 1.3 Examine the objectives when starting up a business

Business Objectives Most people think that businesses only have 1 Objective – PROFIT However, people who start a business may want to achieve a number of things.

Definition Business objectives are the stated, measurable targets of how to achieve business aims. For example: “we want to achieve sales of €10 million in European markets in 2004”.

Business Objectives Objectives give the business a clearly defined target. Plans can then be made to achieve these targets. This can motivate the employees. It also enables the business to measure the progress towards to its stated aims.

Business Objectives can be divided into 2 categories Do you know what they are?

1. Financial Objectives To survive in the market - To break even (cover costs) - To improve its image - To have high motivation amongst employees - To maximise profits - To increase market share - To grow in size (e.g. sales, number of customers, number of employees - To Sell abroad - To diversify and sell different products - To make returns to shareholders if a limited company (dividends)

2. Non Financial Personal satisfaction Challenge Independence Control Helping others Using your skills Being your own boss Something to be proud of

Task Two In your book, list at least 6 examples of financial objectives and 6 examples of non-financial objectives Lets read the case study Page 64 Answer questions 1-3 on page 65

Business Objectives must be Specific – Objectives should specify what they want to achieve. - ie one named person is responsible for delivering the objective 2. Measurable – You should be able to measure whether you are meeting the objectives or not. 3. Achievable – can the objectives be met? 4. Realistic – Can you realistically achieve the objectives with the resources you have? 5. Timed – When do you want to achieve the set objectives? i.e within a given period of time eg 12 months S M A R T

SMART Objectives

Task 3 You are setting up a Breakfast Club in Mascalls School selling Pop Tarts and beverages from 7.30-8.30am (for students & staff) In your books Explain 3 financial objectives that your business will have Explain 3 non-financial objectives of your business

Conflicting objectives A business may find that some of their objectives conflict with one and other: Growth versus profit: To boost sales in the short term, a company may reduce prices; but this will also reduce short-term profit. Short-term versus long-term: A business may have less cash flow available in the short-term if it is spending money investing in new products or plant and equipment.

Task 4 Explain two sets of conflicting objectives that your company (Mascalls Breakfast Club) could have.

Summary Objectives are................... There are ..... Categories of objectives Give 3 examples of objectives from each category What should objectives be? (acronym)

Homework 1. Answer questions 1-4 on page 67. 2. Choose a company to research online and write up at least 5 of their objectives.