Measuring Business Success (Edexcel IGCSE Business)

Revenue

• Income received from selling goods and services is compared over time and against competitors
  • An increase in revenue suggests that a business is growing and its decision-making is effective

Market share

• Sales of the company are measured as the percentage of total sales in an industry
  • Growth in market share over time can help to improve a businesses market position and increase its competitiveness

Profitability

• The proportion of sales converted to profit is compared over time and against competitors
  • A high profit margin means that the business can cover its costs, reinvest profits to grow and reward investors

Business growth

• The opening of new outlets or production facilities or an increase in the size of the workforce suggests business growth
  • Growing businesses can take advantage of economies of scale and are likely to become better-known 

Shareholder satisfaction

• Shareholders are most likely to be satisfied when share prices and dividends are increasing
• A rising share price occurs when a business is increasing profits or is considered to have potential to grow
• Businesses that generate healthy profits may choose to increase dividends for shareholders

Customer satisfaction

• Positive reviews and recommendations from customers indicate that a business is meeting this objective
  
  
• The number of returning customers is an indication of customer satisfaction

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Employee satisfaction

• Low levels of staff turnover, high labour productivity and large numbers of applications for job vacancies indicate that a business is meeting this objective

• In 2023, financial services business Groupe Hexagone was rated by employees as one of France's best places to work

Owner satisfaction

• Business owners often have personal objectives they want the business to achieve
  
  
• If a business is providing a good service, allows an owner to earn a satisfactory income, or achieves recognition, these personal objectives may be met

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