The Economic Climate (OCR GCSE Business): Exam Questions

Unilever plc

Unilever plc is a multinational company that makes and sells a wide range of quality products including food, cleaning agents and beauty products across 190 countries.

Unilever plc has benefitted from operating in a global marketplace and the majority of its products are international brands. Some of its branded products include Lynx Body Spray, Dove Soap, Hellmann’s Mayonnaise, Ben & Jerry’s ice cream and Persil washing machine detergent. All of these products are made in factories all around the globe, some using flow production and others using batch production.

Unilever plc’s average revenue has grown over the last five years. However, the economic climate is becoming more difficult and Unilever plc’s directors are having to adapt to these challenges.

NEXT plc.

NEXT plc. is a clothing retailer selling clothing, footwear, accessories and home products through its high street shops and online across the UK. NEXT plc. understands the importance of creating good relationships with its customers and constantly tries to improve its levels of customer service. Customer service is important for NEXT plc.

For NEXT, responsible business behaviour includes addressing key business-related social, ethical and environmental impacts in a way that aims to bring value to all its stakeholders, including its shareholders. NEXT plc. sources products from many suppliers across the world. The company takes its environmental and ethical responsibilities very seriously.

Glorious Kitchens Ltd

Glorious Kitchens (GK) is a private limited company based in Brighton. The company makes and fits high-quality, luxury wooden kitchens throughout the south-east of England. Its most popular range is the Deluxe.

The average price of a Deluxe kitchen is £15 000 including fitting. GK calculates its fixed costs for the year to be £250 000 and its variable costs for the Deluxe to be £6380, which means they need to sell 29 kitchens to break even.

GK is concerned about the future economic climate and its possible impact on the company’s sales. It is predicted that there will be a fall in consumer incomes in the south-east of England until 2025. Unemployment in the south-east of England is forecast to follow the trend shown in Table 1.

Table 1

Financial data for GK at the end of 2022 is shown in Table 2.

Table 2

Pukka Pies Ltd

Pukka Pies Ltd is a family-owned business with approximately 360 employees. It makes a range of high-quality savoury pies, including steak, chicken and mushroom, and chicken balti, in batches at its factory in Leicester, England. Pukka Pies are sold in more than 4000 food stores nationwide as well as in sports stadiums, fish and chip shops and cafés across the country.

Three of Pukka Pies Ltd’s key values are recruiting people who are ambitious, delighting customers with quality pies, and building trust with suppliers through food safety. Each of these values helps the business meet the requirements of consumer law.

The success of Pukka Pies Ltd is affected by many factors, including its logistical and supply chain decisions. Pukka Pies Ltd procures the ingredients for its pies from businesses across the UK and overseas; consequently its supply chain is long. Nevertheless, all of these ingredients need to arrive in good condition and, therefore, its logistics are time-critical. Unemployment levels also have a significant impact on Pukka Pies Ltd.

Pukka Pies Ltd considers its environmental impact across all aspects of business activity. It has already replaced some of the non-recyclable plastics used in its packaging with alternatives that can be recycled. In addition, none of the company’s waste goes to landfill.

Aston Martin plc

Aston Martin plc (AM plc) is a British manufacturer of luxury sports cars. It has more than 150 car dealerships in over 50 countries on six continents. Its globalised supply chain includes suppliers from the UK, EU and across the world. The company is also expanding its brand to include speed boats, submarines and property development.

Its headquarters and the main production site are centrally located in Warwickshire, England, on the site of a former RAF airbase. It employs over 3000 workers on this site, who are highly skilled engineers and who produce each car using the most up-to-date machinery. When the cars are finished, they are then transported from central England all over the UK and beyond. The demand for AM plc products is influenced by many factors, including UK unemployment rates and consumer income levels.

AM plc is proud of its commitment to the environment, which includes trying to produce goods sustainably. It also considers ethical issues in its decision making.