The firm survival objective is the goal of keeping a business running during difficult times. When a company faces financial trouble, tough competition, or other major threats, its main priority shifts from making a profit to simply staying in business.

Key features include:

• Focusing on generating enough cash to pay short-term debts and avoid liquidity problems.
• Being willing to accept smaller profits or temporary losses to remain operational.
• Becoming the main priority during economic recessions or periods of high competition.

Managerial actions often include:

• Reducing costs, cutting back on payments to investors, or selling company assets.
• Taking on loans with difficult terms just to avoid closing down.
• Focusing on job protection and stability.

Comparison to profit maximisation:

While profit maximisation focuses on growth and earnings, the survival objective is a more realistic goal for small businesses or companies struggling with uncertainty. It acknowledges that, in the real world, a firm must first survive before it can focus on earning higher profits.