Unit 5
Stakeholders
A stakeholder is anyone who has an interest in the success/ failure of a business:
employees
owners
shareholders
consumers
competitors
local community
investors
government
friends/ family
suppliers
Stakeholders Objectives
Shareholders/ Owners – lots of capital, as this is the core reason for running the business, a
sense of pride, business to expand to give a feeling of success, high sales to cover costs and
dividends.
Employees/ Managers – lots of capital to support their livelihood, lots of customers and
success so their work has direct impact, success so they keep their jobs, smooth running
business for promotions.
Suppliers – lots of customers so the business requires more stock, business to expand so a
wider range, so more stock needed, increase in orders and paid on time.
Customers – a high quality, convenient, value for money product or service, business to be
successful to keep prices consistently lower.
Local Community – a successful business which employs many people, boost local
community, generate capital for the community, no pollution, litter or anything to diminish
reputation, respect from business.
Pressure Groups – want the business to change methods in accordance with their values.
Government – a successful business which generates capital, boost the economy, pays
higher taxes and reduces unemployment.
Are shareholders the most important?
Different businesses have different approaches to stakeholders.
e.g. Greggs treat customers and staff as the most important with shareholders third.
If you satisfy the first two then the shareholders objectives are met.
, For large companies, public limited (PLC) shareholders have the right to vote directors
out of office.
This means companies have to be very honest with shareholders, about company
priorities or mistakes are made.
For private limited companies (Ltd) the owner and the family are likely to be
shareholders.
Shareholders are still important, but there may be other important stakeholders e.g. a
business set up to support the community.
Small Business Stakeholders
Important stakeholders are customers, staff and suppliers.
Relationship need to be close as the small business may ask more than is normally
required due to a lack of spare resources.
e.g. a small florist may ask staff to work longer hours to cover a sick absence.
Stakeholders Impact On Business
Shareholders/ Owners – sets the aims and strategy for the business, including how it
behaves. Provides funding and investments to start and expand the business.
Employees – provides a good service, resulting in higher sales, profits and good reputation,
can also have a negative impact, with a bad service, less sales so less profit.
Customers – buy products and services, make recommendation on how to improve them
and recommends business through social media.
Managers – manage employees who do day to day work for the business, communicate
employees’ needs to senior management and communicate business’ needs to employees.
Suppliers – provide the business with materials needed for products or services, affects the
amount of product or services that can be produced or sold e.g. a lack of raw materials
stops production.
Local Community – support their local business by buying its products or services, object to
the business if it has a negative impact on the local community/ environment.
Pressure Groups – change the business’ practices, such as delivery times or packaging,
improve employees’ conditions, such as health and safety or wages and influence
customers’ opinions of the business and their buying habits.
Government – changes the amount of tax that business has to pay, passes new laws relating
to the business and its industry, promotes different types of business activity by providing
funding for particular activities, such as grants for wind farms increases businesses installing
and operating wind farms.
Types of Technology in Business
Stakeholders
A stakeholder is anyone who has an interest in the success/ failure of a business:
employees
owners
shareholders
consumers
competitors
local community
investors
government
friends/ family
suppliers
Stakeholders Objectives
Shareholders/ Owners – lots of capital, as this is the core reason for running the business, a
sense of pride, business to expand to give a feeling of success, high sales to cover costs and
dividends.
Employees/ Managers – lots of capital to support their livelihood, lots of customers and
success so their work has direct impact, success so they keep their jobs, smooth running
business for promotions.
Suppliers – lots of customers so the business requires more stock, business to expand so a
wider range, so more stock needed, increase in orders and paid on time.
Customers – a high quality, convenient, value for money product or service, business to be
successful to keep prices consistently lower.
Local Community – a successful business which employs many people, boost local
community, generate capital for the community, no pollution, litter or anything to diminish
reputation, respect from business.
Pressure Groups – want the business to change methods in accordance with their values.
Government – a successful business which generates capital, boost the economy, pays
higher taxes and reduces unemployment.
Are shareholders the most important?
Different businesses have different approaches to stakeholders.
e.g. Greggs treat customers and staff as the most important with shareholders third.
If you satisfy the first two then the shareholders objectives are met.
, For large companies, public limited (PLC) shareholders have the right to vote directors
out of office.
This means companies have to be very honest with shareholders, about company
priorities or mistakes are made.
For private limited companies (Ltd) the owner and the family are likely to be
shareholders.
Shareholders are still important, but there may be other important stakeholders e.g. a
business set up to support the community.
Small Business Stakeholders
Important stakeholders are customers, staff and suppliers.
Relationship need to be close as the small business may ask more than is normally
required due to a lack of spare resources.
e.g. a small florist may ask staff to work longer hours to cover a sick absence.
Stakeholders Impact On Business
Shareholders/ Owners – sets the aims and strategy for the business, including how it
behaves. Provides funding and investments to start and expand the business.
Employees – provides a good service, resulting in higher sales, profits and good reputation,
can also have a negative impact, with a bad service, less sales so less profit.
Customers – buy products and services, make recommendation on how to improve them
and recommends business through social media.
Managers – manage employees who do day to day work for the business, communicate
employees’ needs to senior management and communicate business’ needs to employees.
Suppliers – provide the business with materials needed for products or services, affects the
amount of product or services that can be produced or sold e.g. a lack of raw materials
stops production.
Local Community – support their local business by buying its products or services, object to
the business if it has a negative impact on the local community/ environment.
Pressure Groups – change the business’ practices, such as delivery times or packaging,
improve employees’ conditions, such as health and safety or wages and influence
customers’ opinions of the business and their buying habits.
Government – changes the amount of tax that business has to pay, passes new laws relating
to the business and its industry, promotes different types of business activity by providing
funding for particular activities, such as grants for wind farms increases businesses installing
and operating wind farms.
Types of Technology in Business
