Edexcel GCSE Business Studies Revision Guide Sample

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Unit 3 Edexcel GCSE Business Studies Revision Guide Sample

Market research
Market research is gathering information about customers, competitors and market trends by collecting primary and secondary data. This information is used to help a business make decisions. There are three stages in market research.
Planning and designing the research
? What are the aims of the research? ? What research techniques could

Doing the research

? What are the time

Analysing the information

? Did people make the

you use?

? Should you use primary or secondary,

qualitative or quantitative data?

limits for the research? ? What is the sample size?

same or different comments? ? Could you identify any trends in the data?

Making decisions
After analysing the information from market research, a business might ask questions like these: Is the marketing mix appropriate? Does a product or service need to be changed to make it more appropriate for customers needs? Should a product or service be left unchanged? Is it time to withdraw or replace a product or service?

Real life market research

When reading about market research in a case study, ask yourself the following questions: Was the right type of research used? ow accurate is the research likely to be? H s the research representative of the I target market? s there any important information that the I market research does not tell us? This will help you discuss the likely success of a product or an idea.

Apple produces home electronics, including strong brands like the iPod and iPhone, for the mass market. Product design is an important part of its success. (a) Identify one method of collecting qualitative market research.

B-A
(1 mark)

target

Some other methods of collecting qualitative market research are interviews, consumer panels or questionnaires/surveys.

Focus groups

(b) Explain how qualitative market research might allow Apple to improve its marketing mix. (3 marks)

Qualitative research will give Apple information about whether consumers find their computers, iPads and iPhones attractive. This will enable Apple to change their product design so that consumers will pay more.

Only one in twenty students got all three marks for part (b). To get full marks you need to relate your answer to the case study, examining the effects on the business.
This was a real exam question that a lot of students struggled with - be prepared!
Draft - subject to review

G-F

target

1. What is meant by the term market 3. Explain one way in which market research research? (2 marks) target data might benefit a business. (3 marks) 2. Identify one way in which a business might collect quantitative market www.pearsonschools.co.uk/reviseedexcel research data. (1 mark)

D-C

Edexcel GCSE Business Studies Revision Guide Sample

UNIT 1

Franchising 2
There are bene ts for a new business setting up as a franchise compared to setting up as a sole trader. However, there are also drawbacks. Access to tried-andtested products Possibly an established customer base Brand image /reputation already established Expensive marketing Benefits of a franchise costs covered by the franchise Higher chance of survival Speci c support and training provided
) de tra ng ssi (pa sy Bu Acce
(parkingss , etc.)

Drawbacks of a franchise
Start-up costs can be expensive. Royalty payments. Complicated application process. Lack of autonomy and control. Limited exibility to make your own decisions.

Location
For some small Proximity competitito businesses, such on as a retail shop or st restaurant, location is Co vital. But for others, location is less important. Factors in choosing a location might include:

D-C

target

Identify two possible disadvantages of operating the business as a franchise. Select two answers. (2 marks) A B C D E The cost of the initial investment can be high Franchises have to take out a patent Franchises have to pay a higher rate of Value Added Tax (VAT) There is a lack of freedom for the owner in making decisions It can access help and advice from the franchise owner

Just over half of students got both marks for this question. Options A and D are the only two answers that could be a disadvantage.
This was a real exam question that a lot of students struggled with be prepared!

When completing multiple-choice que stions, underline the command words in the questio n. In this case, two and disadvantages. This will ensure you know exactly what the question wants you to do.

C-B

target

Which three of the following are possible advantages to an individual of starting a business as a franchise rather than as a sole trader? Select two answers. (2 marks) A B C D E The franchisor pays the franchisee to set up the business Franchises pay lower rates of Value Added Tax than a sole trader A franchise is likely to be an established business The franchisee has complete freedom to make their own decisions The franchisee can benet from national advertising of the franchise

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Edexcel GCSE Business Studies Revision Guide Sample

UNIT 3

Managing stock 1
Managing STOCK is about managing the materials that a business holds in the most ef cient and effective way. Stock can include materials waiting to be used in the production process, work in progress, and some can be nished stock waiting to be delivered to customers.

Bar gate stock

Stock level 1000 Maximum stock level

500

Re-order level Minimum stock level 0 1 2 3 4 Weeks

business is The MA XIMUM STOCK LEVEL the able to hold. at which The RE-ORDER LEVEL is the point business. new stock will be ordered by the and the The difference between this level time it point at which stock increases is the takes for the stock to arrive. MAXIMUM Also known as BUFFER STOCK. The of stock STOCK LEVEL is the lowest amount net in case the business will hold. It is a safety there is a surge in demand.
January
Monday Tuesday Wednesday Thursday 2 3 4 5 Friday 6 Saturday 7 Sunday 8

Just In Time stock control

JUST IN TIME (JIT) stock control is a stock management system where stock is delivered only when it is needed by the production system, and so no stock is kept by a business. For JIT to work a business must have good relationships with suppliers, a well-organised production system, and regular demand for their products.

Order placed

Stock arrives

10

Product made

11

12

13

Product distributed to customer

14

15

16

17

18

19

20

21

22

The diagram illustrates the bar gate stock graph for Go-Go Hamsters at the Saltash Toy Box.
Stock Level 95

Use the diagram to calculate how many weeks it will take for stock of Go-Go Hamsters to arrive at the Saltash Toy Box after re-ordering. (2 marks)

C-B

target

Stock is ordered in week 3 and arrives in week 8. Therefore 8 3 = 5 weeks.

Re-Order Level

60

25

10

15

Number of Weeks

Fewer than four in ten students got this question wrong. Always show your calculations. If you make an error you could still pick up one mark if your calculations show that you understand how to calculate the answer.
This was a real exam question that a lot of students struggled with be prepared!

D-C
48

target

1 2

Using the diagram in the worked example, identify the number of Go-Go Hamsters the Saltash Toy Box holds as a buffer stock. (1 mark) What is meant by the term just-in-time stock control? (2 marks)

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Edexcel GCSE Business Studies Revision Guide Sample

UNIT 5

Growth and standard of living

The STANDARD OF LIVING refers to the amount of goods and services a person can buy with their income in a year. If a person has more income, they can buy more goods and their living standard has risen. Standard of living is measured in GDP PER CAPITA (i.e. GDP population). This shows the AVERAGE living standard of a country and can be used to make comparisons.

The problems of using GDP

GDP per capita is not always a reliable measure of living standards because: if the population is small, GDP rates can give an inaccurate picture GDP is an average and assumes that everyone earns the same, but some earn a lot less and some a lot more GDP may be understated because some output may not be counted.

What other indicators measure living standards?

INFANT MORTATLITY RATES the percentage of babies that do not survive past their fth birthday. LIFE EXPECTANCY RATES the average age that people are expected to live to from birth. LITERACY RATES the percentage of adults who are able to read and write.

Quality of life
The QUALITY OF LIFE is an individuals overall well-being.Number and quality Here are some factors that can inuence it. Peoples health of friends
Levels of education

ABC
Levels of education Peoples health

The spare time people have

Number and quality of friends

Quality of family relationships.

D-C

target

Explain how economic growth might improve the standard of living of a country. (3 marks)

Economic growth results in more output being produced, which causes prices to fall. People can now purchase more goods and services with their income.

You need to clearly explain how economic growth improves the standard of living, making clear use of links and terminology.

C-B

target

Dene the term standard of living.

(2 marks)

Explain one problem with using GDP per capita as a measure of living standards. (3 marks)

B-A
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Edexcel GCSE Business Studies Revision Workbook Sample

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Unit Edexcel GCSE Business Studies Revision Workbook Sample 3

TARGET

Market research
1 Subway is a well-known sandwich retailer. It has become successful by offering consumers a choice and providing a healthier fast-food option. Market research has helped Subway become successful in its market. (a) Which one of the following is an example of qualitative market research? (1 mark)

D-C

Select one answer. A B C D (b) 1 2 (c) Explain one way in which quantitative data might help Subway to improve its marketing mix. (3 marks) A chart showing Subways profits A map showing the location of Subway outlets Consumer opinions on the taste of Subway sandwiches Subways sales figures for the last two years

Qualitative data is not numerical.

Identify two methods Subway might have used to collect market research data. (2 marks)

EXAM ALERT Guided

Students have struggled with exam questions similar to this - be prepared!

Quantitative research will give Subway

Make sure you relate your answer to Subway.

This means Subway because

TARGET

D-C

2 Market research helps businesses to make important decisions about their products and services. (a) Identify one disadvantage to a business of carrying out market research. (1 mark)

(b)

Explain how this disadvantage might affect the business.

(3 marks)

Draft - subject to review

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Edexcel GCSE Business Studies Revision Workbook Sample Unit 1

Had a go

Nearly there

Nailed it!

Franchising 2
Adam Lewandowski works as an environmental officer for a large property company. He is thinking of buying a franchise. He has identified a franchisor called Ecoliving, which was established in 2004. It is a distributor of innovative and sustainable heating, cooling and ventilation systems. For an initial fee of 24 950, Ecoliving offers franchisees the following: a three-month induction programme and ongoing training certification initial display stock of product and equipment deposit on a vehicle and vehicle livery branded clothing manuals launch advertising in-field support, and more.

C
Guided EXAM ALERT

1 Which three of the following are benefits to Adam of buying an Ecoliving franchise rather than operating as a sole trader? (3 marks) Select three answers. A B C D E F Ecoliving is an established brand Franchises do not have to comply with employment legislation Ecoliving provides free access to accountants and solicitors Franchisees do not have to pay interest on business loans Ecoliving provides continued help and support There is a higher chance of survival
Students have struggled with exam questions similar to this be prepared!

It isnt option C because the case study doesnt suggest that Ecoliving provides free access to accountants and solicitors.

2 Which two of the following are possible drawbacks to Adam of buying an Ecoliving franchise? Select two answers. A B C D E Adam will have a lack of freedom when making business decisions The 24 950 set-up fee is quite high Adam will not be permitted to sell the business Franchisees have to pay tax on behalf of the franchisor Adam will need to pass environmental exams before buying the franchise

(2 marks)
Make sure you read the case study carefully so you understand the context of the business.

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Edexcel GCSE Business Studies Revision Workbook Sample Unit 3

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Managing stock 1
Cara James and Cole Simmons sell models of vehicles, action figures and animals. The models are bought in separate parts from manufacturers and then assembled and painted before sale. Figure 1 shows a bar gate stock graph for their model of a dinosaur.
Stock 60 level 50 40 30 20 10 0 0 1 2 3 4 5 6 Number of weeks 7 8 9 10 Reorder level

Figure 1

C
Guided EXAM ALERT

1 (a) Which one of the following is least likely to be stock held by the business? Select one answer. Stocks of: A B C D p aint and parts used when assembling the model s emi-finished models that need painting

(1 mark)

Students have struggled with exam questions similar to this be prepared!

damaged models that have been returned finished models ready to be sold

(b) Using the diagram, identify the number of models that Cara and Cole hold as a buffer stock. (1 mark) (c) Use the diagram to calculate how many weeks it will take for stock of dinosaur models to arrive after reordering. (2 marks)
This can be calculated using the date on which stock is reordered and the date on which it arrives.

(d) Describe one advantage to Cara and Cole of holding large stocks of models. Here is a plan you could use for your answer: Think about why large stocks might be needed or how buying large stocks can save money. Describe how the business benefits from holding large stocks.

(3 marks)

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Edexcel GCSE Business Studies Revision Workbook Sample Unit 5

Had a go

Nearly there

Nailed it!

Growth and standard of living

According to a recent report, the UK is the worst place to live in Europe for quality of life, behind countries with damaged economies such as Ireland and Italy. The UK has the second-lowest number of hours of sunshine a year, the fourth-highest retirement age, and the third-lowest spend on health as a percentage of GDP. Also, despite higher incomes, Britons have 5.5 fewer days, holiday a year than the Europeans, and endure a lower government spend on education. Source: www.guardian.co.uk

1 (a) The standard of living in a country can be measured using GDP per capita. Which of the following best describes GDP per capita? Select one answer. A B C D T he value of output produced by a country in a year multiplied by the population of that country T he value of goods and services produced by a country in one year (1 mark)

The value of all the money in the economy divided by the population The value of output produced by a country in a year divided
by the population of that country (2 marks)
Remember that explanations are not needed in this type of question. Consider some of the factors mentioned in the case study.

(b) State two possible problems with using GDP per capita to measure the standard of living. 1 2

B
Guided

W 2 (a) hat is meant by the term quality of life?

(2 marks)

(b) Explain why the rate of life expectancy in a country might be an indication of its living standards. (2 marks) Here is a plan you could use for your answer: Define life expectancy. Explain how an increase in life expectancy arises as a result of more income.

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