Aims, objectives and mission
An aim is a general goal, like “be the best bakery in town”. An objective is a smaller, exact target that helps reach the aim, like “sell 400 loaves a day by December”.
The mission (or mission statement) is a short sentence that says why the business exists and what it values. Objectives are the steps that turn the mission into action.
Good objectives are SMART: Specific (exact), Measurable (has a number), Achievable (possible), Realistic (fits the money and staff) and Time-bound (has a deadline).
Objectives help a business: they give staff a clear target, help managers plan and decide, and let owners check progress.
Common objectives: survival, profit, growth and market share
- Survival: stay open. This matters most for new firms and in hard times. The firm must have enough cash to pay its bills.
- Profit: earn more than it spends. Profit = revenue − total costs. Profit rewards owners and pays for future growth.
- Growth: get bigger: more sales, more shops, more staff or new markets.
- Market share: our part of all the sales in a market. Market share (%) = our sales ÷ total market sales × 100. A bigger share often means a stronger brand.
- Other objectives: good customer service, high quality, being ethical (fair to people), being green (less harm to nature), and making staff happy.
Why objectives differ and change
Objectives are not the same for every business.
- Size and age: a start-up wants survival; a large firm wants growth and market share.
- Type of business: a charity or social enterprise aims to help people, not to make the largest profit. A public-sector body aims to give a service.
- Owners: a sole trader may want a good life balance; shareholders may want high profit.
Objectives also change over time because of: the economy (in a slow-down, survival comes back), new competitors, new technology, new laws, or the firm reaching its old targets.
Judging success beyond profit
Profit is easy to measure, but it does not tell the whole story. A business can also judge success by:
- Sales growth and market share.
- Customer satisfaction (reviews, repeat buyers).
- Staff well-being (low staff leaving, good pay).
- Social and green results (less waste, fair trade, help for the local area).
- Owner's own goals (freedom, pride, time with family).
For a larger firm, profit can be compared over time or with rivals; it is also checked against the cash the firm holds, because a profitable firm can still run out of cash.
Try it
Pick a shop near your home. Write its likely mission in one sentence and one SMART objective for it. Then in the 3D free play, set revenue and costs so that profit is exactly zero, and change “our sales” until market share is 25%.
Key formulas and definitions
- Profit = total revenue − total costs
- Market share (%) = our sales ÷ total market sales × 100
- Growth in sales (%) = (new sales − old sales) ÷ old sales × 100
- SMART = Specific, Measurable, Achievable, Realistic, Time-bound
- Mission = why the firm exists; objective = measurable target with a deadline
Worked examples
1. A shop has revenue of ₹2,40,000 and total costs of ₹1,90,000 in a month. Find its profit.
Profit = 2,40,000 − 1,90,000 = ₹50,000.
2. In a town, all shops sell 5,000 phones a year. One shop sells 750. Find its market share.
Market share = 750 ÷ 5,000 × 100 = 15%.
3. Sales rose from 800 units to 1,000 units. Find the growth in sales.
Growth = (1,000 − 800) ÷ 800 × 100 = 200 ÷ 800 × 100 = 25%.
4. Rewrite “sell more bread” as a SMART objective.
“Increase bread sales from 300 to 360 loaves a day (20% up) by 31 March.” It is specific, has a number, is possible, fits the bakery and has a date.
5. A firm's revenue is $50,000 and costs are $56,000. Is it meeting a profit objective? What objective might it switch to?
Profit = 50,000 − 56,000 = −$6,000, a loss. It is not making profit, so it may switch to survival: cut costs and protect cash.
6. A café's market share fell from 30% to 24% while its sales stayed at 600 cups. What happened to the total market?
Year 1 market = 600 ÷ 0.30 = 2,000 cups. Year 2 market = 600 ÷ 0.24 = 2,500 cups. The market grew, but the café did not grow with it, so its share fell.
Common mistakes
- Mixing up aims and objectives. An aim is general; an objective has a number and a deadline.
- Thinking every business wants maximum profit. Charities, social enterprises and new start-ups often have other main goals.
- Thinking market share must rise when sales rise. If the whole market grows faster, share can fall.
- Treating objectives as fixed. They change with the firm's age, the economy and competition.