Major business objectives in Kenya

  

Date Posted: 4/5/2012 8:23:32 AM

Posted By: sashoo  Membership Level: Silver  Total Points: 382

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Some examples of specific business objectives are as follows:

a) Profitability:
This is where a firm sets high profits for goods and services so as to maximize margins. Profitability objective is applicable where the firm enjoys economies of scale through bulky production activities, hence, making the unit cost of production to go down. This objective is common where customers have good purchasing power and are also quality sensitive. This is also seen in a case where by there are few competitors in the industry, so the business enjoys monopoly by being the only producer of a good or service. When this happens, the business normally sets high prices to maximize on profits.

b) Survival:
This is where a firm tries to set reasonable prices for its goods and services so as to attract price sensitive customers on the market. Under this situation, the firm registers normal profits but it is able to have a large customer base. Thus the firm will be assured of customer loyalty, now and in the future.

c) Growth Objective:
This is where a firm intends to expand its operations and acquire new markets, new customers and emerging markets. The aim is to control large market share. This can be achieved through intensive promotional campaigns, forming alliances, entering new markets and so on.

d) Corporate Social Responsibility Objective:
All organizations that care for the society at large spend social costs or extend their gains to the society. This is done through participation in corporate social responsibility activities. These corporate social responsibilities include donations, sponsorships, building of infrastructure, allowing the public to use company facilities, clean-up exercises, offering free medical services and so on. Through participation in corporate social responsibility activities, the firm is likely to achieve a good image in the market. Thus, customers would prefer buying from organizations that exercise this

objective.

e) Increasing Shareholders Value:
It is an important objective for a business enterprise to ensure that its operations maximize returns on investments. Thus, a portion of the retained earnings should be declared by the Board of Directors to be payable to shareholders as dividends and improve the face value of the company’s shares on the stock-exchange – if the company is a public limited enterprise.

f) Prestige Objective:
This is where a firm aims at producing goods and services that are rare on the market, with unique features and of high quality. This helps a firm to gain a positive perception on the market.

g) Image Objective:
This is where a firm aims at improving its reputation on the market. To do so, the firm should be involved in delivering quality customer services and also offering high quality goods, as well as participation in social responsibility activities like, donations and so on.

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