Oct/Nov 2025

WMH is a business operating in the secondary sector. It produces furniture such as tables and chairs. All WMH employees are members of a trade union. The Managing Director recognises that the business is probably going to stay small. She is thinking about bringing new technology into WMH’s factory. She also knows that a manufacturing business needs to pick a suitable factory location.

Classification of businesses

CPW is a private sector business with a number of objectives. It sells electrical goods, including kettles and ovens, through its 36 shops in country X. CPW also provides a delivery service. To avoid import tariffs, the business buys all of its inventory from local suppliers. The Finance Director is studying CPW’s statement of financial position. An extract is given in Table 2.1. He has been asked to identify a source of finance to buy 10 new delivery vehicles.

Statement of financial position

SBL is a fast-food restaurant that sells 900 chicken burgers per week and has 14 employees. The owner, Vicki, trains her staff but does not yet use delegation. She is drawing up a break-even chart to help work out SBL’s margin of safety. Fig. 3.1 shows a break-even chart that is only partly completed. Vicki also wants to understand how an economic recession could affect her business.

Organisation and management

MTL is a large business that sells children’s toys. It aims to behave ethically towards every stakeholder group, including its 430 employees. Competition in the market where MTL operates has intensified. The business relies on several different ways to promote its products. A strong brand image matters. MTL’s directors are thinking about moving into a new market in another country, and they recognise that this could create difficulties.

Marketing mix

BEI is a multinational company that manufactures aeroplanes. Quality assurance is important at BEI. It has 5000 employees. BEI’s directors have announced plans to cut the size of its workforce (downsize). The Human Resources Director is deciding which employees should be made redundant. Details of employee A can be found in Table 1.1.

Achieving quality production

OTK is a small jewellery shop located in the middle of Main City. At present, the business does not use ecommerce. OTK purchases its jewellery from local suppliers. Payment for the jewellery is made 30 days later. The shop manager is studying OTK’s cash flow forecast. She worries that the business could face a short-term cash flow issue.

Cash-flow forecasting and working capital

Miguel is intending to launch a gym (sports club). It will provide a variety of fitness classes, including yoga. The business will operate as a partnership with his sister. Miguel believes the business will stay small in scale. Secondary market research will be used to support decisions, including which pricing method to adopt. Miguel understands that choosing an appropriate location is important for any new business.

Location decisions

DJU makes clothing such as jeans and trousers, and its factory employs 90 people. Specialisation is used in production. The Managing Director is examining DJU’s cost and output figures, and an extract appears in Table 4.1. She also wants to find out how lower interest rates could influence the business. DJU’s directors are looking at several methods of business growth, including buying a competitor.

Enterprise, business growth and size

KPX makes computers. The business brings in 60% of its raw materials from overseas. The Operations Director is looking at ways to apply lean production methods in KPX’s factory. The Finance Director is examining KPX’s financial information to work out the amount of its expenses. An extract appears in Table 1.1.

Production of goods and services

Max is an entrepreneur planning to set up a business that sells books. He has chosen to use ecommerce. He has also been told that the government offers support for start-up businesses. He plans to use market research to support his business decisions. Max understands that building customer loyalty is important for a new business.

Market research

STB is a public limited company, and it builds houses through job production. During 2024, the business completed 13 500 houses. STB has several stakeholder groups, among them its 5000 employees. The Managing Director understands that business activity can have environmental effects and that there are many reasons for a business to react to environmental pressures. She also wants to find out how economic growth could influence STB.

Economic issues

ZPR operates in the tertiary sector. It runs 1 restaurant and employs 20 staff. The Human Resources Manager is drawing up a job description because ZPR needs 2 new chefs. He said: ‘I need to advertise the job vacancies externally.’ ZPR will offer a range of financial rewards, as recruiting employees can be difficult. The manager understands that many factors must be weighed up by a business when choosing who to recruit.

Recruitment, selection and training of employees

Explain two advantages and two disadvantages of a business operating as a private limited company.

Types of business organisation

Explain two advantages and two disadvantages to LB of using primary market research.

Market research

Explain two reasons why working capital is significant to LB.

Cash-flow forecasting and working capital

Explain two factors LB’s managers should take into account when choosing which communication method to use to tell employees about the expansion plans.

Internal and external communication

Explain four ways a business plan may assist Kathryn.

Internal and external communication

Explain two benefits and two limitations of a business that operates in a niche market.

Marketing mix

Explain two reasons for FF using job production.

Production of goods and services

Explain two reasons why high quality matters to FF.

Environmental and ethical issues

Explain two reasons why customers might choose to buy from ES instead of one of its competitors.

Types of business organisation

Explain two advantages that ES gains from having a short chain of command.

Organisation and management

Explain four benefits to a business of using social media for promotion.

Marketing mix

Explain one way each of the following ES stakeholder groups may find the financial information in Appendix 3 useful. Owners. Employees. Suppliers. Bank.

Analysis of accounts