AQA A-Level Business

## Why businesses exist A business exists to combine resources (land, labour, capital and enterprise) into goods or services that customers will pay for, and to do so well enough to keep going. Who it does this for depends on who owns it: a company owned by shareholders usually exists to earn them a return, a charity exists to serve a cause, and a cooperative exists for its members. The owners' purpose shapes what the business tries to achieve, which is set out in its mission and its objectives. The **mission** is a statement of the business's overall purpose: what it does, for whom and to what standard. It is broad, rarely changes and is not measurable. A mission such as providing affordable, healthy food to families gives direction, but it does not say what to do this year. An **objective** is a specific, measurable target that moves the business towards its mission. Objectives are what managers are judged against, so they need a number and a date: raising market share from 12% to 15% within three years, for instance. The mission and the objectives are linked in one direction. The mission sets the boundaries, and the objectives are chosen inside them. A business whose mission is to be the most trusted name in its market will reject an objective of rapid growth if reaching it would mean cutting quality. The objectives then feed down into the targets of each function, such as marketing, operations, finance and human resources, which is how a mission ends up shaping daily…