Business Growth (OCR GCSE Business): Exam Questions

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.

Nina’s Knitting Supplies

Nina runs a successful business selling knitting wool and sewing products. She opened her first shop 15 years ago. The business has grown organically and now sells products from 10 shops and a website. Nina uses market segmentation to target customers. Nina employs 80 people. She works hard to meet the shared objectives of her employees, as well as external stakeholder groups such as customers, suppliers, lenders and the local community.

Nina produces a weekly update that is sent by email to all employees every Friday. The updates contain information about the future development of the business, plus other stories of interest to employees. Recent stories include congratulating an employee on the birth of a child and the charity fundraising activities of one shop.

Nina plans to develop the business further over the next five years, especially as knitting is becoming an increasingly popular pastime. This has led to more competitors entering the market.

Nina’s Knitting Supplies

Nina runs a successful business selling knitting wool and sewing products. She opened her first shop 15 years ago. The business has grown organically and now sells products from 10 shops and a website. Nina uses market segmentation to target customers. Nina employs 80 people. She works hard to meet the shared objectives of her employees, as well as external stakeholder groups such as customers, suppliers, lenders and the local community.

Nina produces a weekly update that is sent by email to all employees every Friday. The updates contain information about the future development of the business, plus other stories of interest to employees. Recent stories include congratulating an employee on the birth of a child and the charity fundraising activities of one shop.

Nina plans to develop the business further over the next five years, especially as knitting is becoming an increasingly popular pastime. This has led to more competitors entering the market.

Shinz Ltd

Five years ago, brothers Tom and Amir set up a car washing business called Shinz Ltd in the town of Littlelong. The business has been very successful and currently offers ‘economy’, ‘gloss’ and ‘high-gloss’ washing services. Tom is responsible for the administration, finance and marketing functions. Amir is responsible for the car washing operations and supervises two fulltime employees. The prices Shinz Ltd charges are not low when compared to its competitors. Customer service is a priority for the business.

Tom and Amir are keen to expand the business and are planning to launch a new ‘resin polish’ service, to protect car paintwork during the cold winter months. Many of Shinz Ltd’s customers have requested this service. ‘Resin polish’ is not currently available in Littlelong but is offered by a business in another town five miles away. Tom is considering whether to use competitor pricing or price skimming for this new service.

Littlelong Motors Ltd is a used car retailer. The business has three owners. They have suggested a merger with Shinz Ltd. Littlelong Motors Ltd offers a basic car washing service in addition to its car sales. It prides itself on offering the lowest prices in the town. 26% of Littlelong Motors Ltd’s customers are ‘extremely satisfied’ with the car washing service provided. This compares to 68% of Shinz Ltd’s customers saying they are ‘extremely satisfied’.

The car washing market in Littlelong is valued at £460 000 per year. The chart below shows the market share of the four car washing businesses located in the town.

Greggs

Greggs is a modern ‘food-on-the-go’ retail brand. It specialises in selling sandwiches, cakes, pastries and pies. Most of these are made by Greggs, using raw materials such as flour, meat and yeast. The company opened its first bakery 80 years ago and has since grown significantly. It currently has 20 000 employees. Greggs’ aim is to become the customer’s favourite for ‘food-onthe-go’ in the UK. This sector is growing quickly and is forecast to be worth £23.4 billion by 2024 (up from £18.5 billion in 2019).

According to The Vegan Society, the number of people in the UK choosing a vegan diet has increased during recent years (see Fig. 1).

Using the market data, Greggs responded to this change by launching vegan sausage rolls in January 2019. The publicity generated helped Greggs’ total sales to increase by 9.6% in its next seven weeks of trading. Following this success the business launched other products, including vegan doughnuts and vegan steak bakes, based on consumer demand.

Managers at Greggs constantly monitor changes in consumer tastes. Similarly, they keep up-to-date with changes in employment law. Greggs’ managers also take pride in the business being named one of the happiest places to work in the UK. Greggs offers many ways of working, including part-time roles.

Beautiful Buds plc

Beautiful Buds plc is a company which grows plants that are sold to garden centres throughout the UK. Beautiful Buds plc has a new Managing Director who has proposed a merger with Green Gardens plc, a chain of garden centres selling a wide range of plants and other garden products.

Green Gardens plc is currently one of the country’s largest plant and garden retailers, with a market share of approximately 12%. The vertical merger will result in one company owning a chain of garden centres as well as growing the plants which are sold in these retail outlets.

Beautiful Buds plc currently has 124 employees. Its Managing Director is looking to make the business more efficient and is planning to change its organisational structure by removing two layers of management (see below). This change is planned before the proposed merger. The Managing Director believes that the tasks carried out by Middle Managers and Team Leaders can be effectively completed by employees either below or above them in the structure. The estimated redundancy costs due to the restructuring are £200000.

Beautiful Buds plc’s current salary structure

Beautiful Buds plc

Beautiful Buds plc is a company which grows plants that are sold to garden centres throughout the UK. Beautiful Buds plc has a new Managing Director who has proposed a merger with Green Gardens plc, a chain of garden centres selling a wide range of plants and other garden products.

Green Gardens plc is currently one of the country’s largest plant and garden retailers, with a market share of approximately 12%. The vertical merger will result in one company owning a chain of garden centres as well as growing the plants which are sold in these retail outlets.

Beautiful Buds plc currently has 124 employees. Its Managing Director is looking to make the business more efficient and is planning to change its organisational structure by removing two layers of management (see below). This change is planned before the proposed merger. The Managing Director believes that the tasks carried out by Middle Managers and Team Leaders can be effectively completed by employees either below or above them in the structure. The estimated redundancy costs due to the restructuring are £200000.

Beautiful Buds plc’s current salary structure