CFG is a social enterprise. It sources cocoa beans from local farmers and then turns the beans into chocolate. Ethical behaviour matters to the business. CFG has created a new chocolate bar. The Marketing Manager intends to use skimming as the pricing method and retailers as the distribution channel for the new product. He recognises that a business may be affected by many legal controls over marketing.
(a)[2]
Define the term ‘social enterprise’.
(b)[2]
Identify two ways legal controls over marketing may affect a business.
Way 1:
Way 2:
(c)[4]
Outline one benefit and one drawback to CFG of using skimming as its pricing method.
Benefit:
Drawback:
(d)[6]
Explain one advantage and one disadvantage to CFG of using retailers as its distribution channel for the new product.
Benefit:
Explanation:
Drawback:
Explanation:
(e)[6]
Do you think ethical behaviour will always lower profit for a business? Justify your view.
Worked solution & mark scheme
This 20-mark question has a full step-by-step worked solution and mark scheme. One marking point: “An organisation with social objectives that aims to make profit so the profit can be reinvested in the business” …