Oct/Nov 2024

RSL produces paint with flow production. In the previous year, it made 10 million litres of paint. The factory employs 6 managers and 80 employees. The managers adopt different leadership styles. For internal communication, RSL relies on email and telephone calls. The Operations Manager wants to find out why some manufacturing businesses are shifting their operations to other countries.

Location decisions

Mitchell is an entrepreneur who plans to launch a business selling books. As part of his business plan, Mitchell has completed some market research. An extract is shown in Fig. 2.1. Mitchell will use microfinance as a source of finance. He wants to find out whether the opportunities from using ecommerce for a new business are greater than the threats. Extract from Mitchell’s 2023 market research data Chart 1: Categories of people who read books Children 35% Students 18% Adults 20% Older people 27% Chart 2: Book sales by type (million) Electronic books 20 Audio books 10 Paperbacks 50 Hardbacks 15

Enterprise, business growth and size

JTA is a public limited company that sells holidays to a mass market. It operates 44 shops and employs 200 people. The Finance Director is looking at ways in which a business can increase profit, and she has been asked to assess JTA’s financial performance by using ratio analysis. Table 3.1 contains an extract from JTA’s financial statements.

Analysis of accounts

FSW is a multinational company operating in 6 countries. It makes steel for the construction industry. Quality assurance is used so that production remains of high quality. FSW has several stakeholder groups that are interested in what it does. The Managing Director knows that FSW’s business generates external costs. She also knows that pressure groups attempt to affect business decisions.

Business objectives and stakeholder objectives

Avtar runs a car repair business in the private sector. The business is small and has 2 full-time employees. He wants to discover the best method for a business to raise added value. Avtar’s business requires finance for several reasons. He also wants to understand how an economic recession could influence his business.

Business activity

SNT operates as an ethical business. It makes a variety of soft drinks by using batch production. During 2023, SNT produced 300 000 bottles of soft drinks each week. A number of factors influence the level of inventory the business ought to keep. SNT’s directors plan to grow the business into fresh markets in other countries through a joint venture. They are also weighing up licensing as another method that could help deal with the possible difficulties of moving into these new markets.

Business and the international economy

HRO makes children’s toys. It is a private limited company. The chief aim of HRO’s shareholders is to raise profit. This could clash with the aims of other stakeholder groups, including its 30 suppliers. HRO’s Managing Director understands that market research can support marketing decisions. The Finance Director is compiling HRO’s statement of financial position. An extract appears in Table 3.1.

Statement of financial position

TLA is a major hotel with 200 rooms and 3000 employees. A lot of these employees belong to a trade union. The Managing Director is intending to enlarge the business but is concerned that diseconomies of scale may occur as TLA gets bigger. The Human Resource Director has been told to recruit 2 new managers. She understands that it is essential for every manager to use the most suitable leadership style. Every one of TLA’s new employees is given induction training.

Recruitment, selection and training of employees

Explain four factors that could cause a business to stay small.

Enterprise, business growth and size

Explain two management functions for CC’s new manager.

Organisation and management

Explain two benefits and two limitations of CC that arise from using batch production.

Production of goods and services

Explain two reasons why CC may need finance.

Marketing mix

Explain two advantages and two disadvantages of BB operating as a public limited company.

Motivating employees

Explain two consequences of BB having a short chain of command.

Organisation and management

Explain one way each of the following stakeholder groups could be affected if a business becomes a multinational company. • Effect on shareholders • Effect on employees • Effect on suppliers • Effect on the government

Business objectives and stakeholder objectives

Explain two reasons why BB may wish to sell its products in fresh markets in other countries. Reason 1: Explanation: Reason 2: Explanation:

Analysis of accounts