What goals does a business set itself, and why does it need clear aims?
Explain common business aims and objectives - making a profit, surviving, growing, and giving good customer service - and why setting clear goals matters
A simple guide to business aims and objectives. Making a profit, survival, growth and good service, the difference between an aim and an objective, and why clear goals matter.
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What this dot point is asking
You need to explain the common goals a business sets itself - making a profit, surviving, growing, and giving good customer service - and why having clear goals matters. You should also know the simple difference between an aim (a general, long-term goal) and an objective (a smaller, specific step that helps reach the aim). Keep your answers practical, and be ready to suggest sensible aims and objectives for a particular business.
The answer
What aims and objectives are
An aim is a general goal that a business wants to reach, usually over the longer term, such as "to grow the business". An objective is a smaller, specific step that helps reach the aim, often with a number and a time so the business can check whether it was met, such as "open a second shop within two years". Aims point the direction; objectives are the steps along the way.
Common business aims
- Making a profit
- Most businesses aim to earn a profit, because the profit rewards the owner and lets the business keep going and grow. Profit is what is left after all the costs are paid.
- Survival
- A new business, or one in a hard period, often aims simply to survive - to cover its costs and stay open. Survival matters most at the start, when there are many costs and few customers.
- Growth
- A business may aim to grow by serving more customers, opening more branches, or selling more products. Growth can bring more profit and a stronger name.
- Good customer service
- Many businesses set giving good service as a goal, because happy customers come back and tell others, which supports profit, survival, and growth.
Why clear goals matter
Clear goals matter because they give the business and its staff a direction to work toward, help everyone pull in the same direction, and let the business measure success by checking whether the objectives were met. Without clear goals, a business drifts and cannot tell if it is doing well.
How aims change over time
A business often changes its main aim over time. At the start, survival comes first. Once it is steady, it aims for profit and good service. When it is doing well, it aims to grow. The goals are not fixed.
Examples in context
Example 1. A newly opened food stall. In its first months the stall's main aim is survival - covering the rent and ingredient costs while it builds up regular customers. A sensible objective is to break even (cover all costs) within six months. Once it is steady, the owner can switch the aim to making a profit and then to growth.
Example 2. A growing bubble-tea chain. A chain that already does well aims to grow. Its objectives might be to open three new outlets in two years and to raise daily sales at each outlet by a set amount. It also aims for good service, because consistent, friendly service across all outlets keeps customers loyal and supports the growth aim.
Try this
Cue. State two aims a new clothing shop might have, and explain why survival is often the first aim for a new business. Think about the high start-up costs and the small number of customers a shop has when it first opens.
Cue. Explain the difference between an aim and an objective in one or two sentences, using a cafe as your example. Remember an aim is general and long-term while an objective is a specific, measurable step.
Cue. A hotel has the aim of giving excellent customer service. Suggest two measurable objectives that would help it reach this aim. Turn the general goal into specific steps with a number or a time, such as a target for complaints or for guest satisfaction scores.
Exam-style practice questions
Practice questions written in the style of SEAB exam questions on this dot point, with worked answer explainers. The year tag is the paper they imitate, not the source.
Original4 marksA new bubble-tea shop has just opened. (a) State two aims the shop might have in its first year. (b) Explain why a brand-new business often has survival as its main aim.Show worked answer →
(a) Two aims: to survive its first year, and to build up a group of regular customers. Making a small profit and giving good customer service are also accepted.
(b) A brand-new business often aims to survive first because it has many start-up costs (rent, equipment, stock) and few customers at the start. If it can cover its costs and stay open, it has time to grow and earn profit later.
What markers reward: two sensible first-year aims, and a clear reason survival comes first (high start-up costs and few customers early on).
Original5 marks(a) Explain the difference between an aim and an objective. (b) A cafe has the aim of growing its business. Suggest two objectives that would help it reach this aim.Show worked answer →
(a) An aim is a general, long-term goal (where the business wants to get to). An objective is a smaller, specific step that helps reach the aim, often with a number and a time, so the business can check if it was met.
(b) Two objectives to support growth: open a second branch within two years; increase the number of customers served each day by 20 over the next six months. Other clear, measurable steps are accepted.
What markers reward: a correct difference (aim is general and long-term, objective is specific and measurable), and two objectives that are specific steps toward growth, ideally with a number or a time.
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