Business Enterprise & Entrepreneurship (OCR GCSE Business): Exam Questions

SJ Salon

SJ Salon is a hair salon owned by Sam and Jamila. The business partners met whilst studying hairdressing at college. The partners’ creativity has helped make the salon very successful. SJ Salon is currently the only salon in town and uses cost-plus pricing.

Sam and Jamila are qualified hairdressers who work full-time in the salon. Until recently, the partners employed one part-time and one full-time worker who works 40 hours per week. However, due to increasing customer demand, two additional part-time employees have recently been recruited.

Sam and Jamila have just found out that a national hairdressing chain is planning to open a new salon in their town. They are concerned about the impact of this competition. The partners asked 200 current customers to complete a short questionnaire. The results show that:

• 130 of the customers have used SJ Salon since 2019

• 104 of the customers were aware of the national hairdressing chain

• 84 of the customers would consider trying the new hair salon, if its prices were cheaper

• 66 of the customers consider quality of service to be more important than price.

When SJ Salon was set up in 2014, Sam wrote a business plan. He has not written another one since then, as the business has been profitable. However, Sam now thinks that a new business plan should be written to help the business succeed against any new competition. Jamila disagrees, as the original business plan took Sam 30 hours to write. She feels that his time would be better spent keeping current customers satisfied.

Boohoo was started in 2006 by two entrepreneurs who had the idea of starting a business where customers could buy the latest fashions online.

Boohoo has expanded using organic growth, and has become a global online retailer of its own brand clothes, shoes and accessories. It now sells in over 100 countries. Boohoo charge for delivery. It has millions of website users per month.

The target market for the Boohoo brand is men and women who are 16 to 24 years old and are fashion conscious. To reach this market, Boohoo uses social media. The business is active on Facebook, Twitter, YouTube and Instagram.

Boohoo has also introduced apps for smartphones and tablets that allow customers to browse and buy products very easily.

Dyson

Disappointed with the performance of vacuum cleaners on the market, James Dyson thought he could design a better product. He started to create his first vacuum cleaner in the late-1970s. In 1984, after trying thousands of designs over several years, James Dyson launched a bagless vacuum cleaner in partnership with Amway, a US consumer goods manufacturer. This partnership did not work out, so James Dyson formed his own company in 1991.

Today, Dyson Ltd produces a range of home appliances including vacuum cleaners, hand dryers, heaters, hair dryers and lights. Creating new and innovative products continues to be important for the company, as seen by its expanding product range. The company has over 12 000 employees worldwide. Dyson Ltd has a unique organisational structure.

All new employees of Dyson Ltd go through an induction training programme. In addition, the company encourages employees to progress by offering apprenticeships and other staff development opportunities. James Dyson promotes careers in engineering, both in schools and in universities.

Miles Ahead

Miles Ahead is a bicycle retailer which was set up in 2001 by entrepreneur, Reg Patel. Reg started with one shop, but the business has gradually expanded. There are now six ‘Miles Ahead’ shops. Despite the growth in Miles Ahead, Reg still operates the business as a sole trader, with 15 employees and a tall organisational structure. Reg segments the market (e.g. different bicycles according to age, gender, lifestyle and income), which he thinks has supported his success.

Reg is going to retire in six months’ time. He is selling the business to Nessa Watts. Nessa has a lot of business experience. She has sold jewellery online as a sole trader for many years. Nessa has plans to expand Miles Ahead.

Nessa has had to borrow £500 000 to purchase the business from Reg. Nessa is considering whether to open more ‘Miles Ahead’ shops or launch a ‘Miles Ahead’ website so that customers can purchase online. Sales within the business have fallen over the past two years (see Fig. 2) which Nessa feels is due to the traditional appearance of the shops.

The latest customer satisfaction information is also of concern to Nessa (see Fig. 3).