Year 10 GCSE Business Ark Globe Academy Remote Learning ... 10 Business Remote... · Match each type of business growth to its correct definition 2.1 Merger a. When a business finds

Year 10 GCSE Business Ark Globe Academy

Remote Learning Pack Phase III

Monday 11th May - Friday 22nd May

Session Title Work to be completed Resource

provided Outcome On-Line

Support

1 2.1.1 Business growth

1. Complete knowledge recap worksheet

2. Answer the spec check questions

3. Read the case study and answer the exam style questions

Worksheet Spec check questions Case study

Completed worksheet Full sentences for all the spec check questions Full exam style answers

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2 2.1.2 Changes in business aims ad objectives






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3 2.1.3 Business and globalisation






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4

2.1.4 Ethics, the environment and business






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Session 1 – Business Growth

Q2 Match it! Match each type of business growth to its correct definition 2.1 Merger a. When a business finds new customers to buy its products 2.2 Takeover b. When a business produces a related or different product

2.3 Research and development

c. When a business brings something new to the market

2.4 New products d. When two businesses agree to join together to make one new business

2.5 Innovation e. The process of investigating and producing new products

2.6 Expanding overseas f. When one business purchases another business

2.7 New markets g. When a business find a new market in another country

Q3 Benefit or drawback? Identify whether each of the following statements is a benefit or drawback to internal or external growth

Internal/Organic External/Inorganic

Benefit Drawback Benefit Drawback

3.1 This type of growth can reduce competition

3.2 With this type of growth, market share can be increased over night

3.3 This type of growth tends to be easier to manage and control

3.4 This type of growth can be too slow

3.5 This type of growth can be expensive

Q1 Fill in the gaps Growth is the ________________ of many businesses. When a business grows, it means its sales and therefore __________________ increases, which often leads to an increase in __________________ if ______________ can be controlled during the growth phase. The key question for a ___________________ business is how growth can be achieved. There are two methods in which businesses can grow. The first is internal or __________________ growth that occurs when a business grows from _________________, for example by producing a new product. The second method is external or ______________________ growth that comes from ____________________ the business, such as growth through a __________________ or takeover with another business. Choose from: merger; within; outside; organic; inorganic; profit; aim; growing; costs; revenue

3.6 With this type of growth, managers

may lack the experience to deal effectively with the other businesses

3.7 If this type of growth is pursued, market share could fall as other businesses expand more quickly

3.8 This type of growth tends to be less expensive and can often be paid for out of retained profit

Q4 Key terms quiz! Define the following key business terms 2.1 Public limited company:

2.2 Limited liability:

2.3 Stock market flotation:

Q5 True or false? Identify if the following statements are true or false

True False

3.1 A public limited company has unlimited liability

3.2 A public limited company has to file their accounts with Companies House

3.3 A public limited company can only sell shares if all existing shareholders agree

3.4 There are more potential buyers for shares in a public limited company compared to a private limited company

3.5 Public limited companies quote on the stock market so the general public can buy shares in the business

Q6 Pro or con? Identify whether each of the following statements is a pro or con to an expanding

private limited company that is contemplating stock market flotation and becoming a plc Pro Con

6.1 Stock market flotation can provide an expanding business with a huge amount of share capital

6.2 Shares are sold on the stock exchange, so can be bought and sold easily

6.3 Anyone can buy shares and as a result, shareholders may have different aims to the people running the business

6.4 The business can be taken over if the majority of shareholders agree to sell their shares

6.5 Stock market flotation can raise the profile of the business

Spec check…. Write out the following in full sentences

1. Can you define organic growth? 2. Can you define inorganic growth? 3. Can you describe the difference between takeovers and mergers? 4. Can you identify 3 advantages of becoming a PLC? 5. Can you identify 3 disadvantages of becoming a PLC? 6. Can you identify 2 advantages and 2 disadvantages of retained profit? 7. Can you identify 2 advantages and 2 disadvantages selling assets? 8. Can you identify 2 advantages and 2 disadvantages of loan capital? 9. Can you identify 2 advantages and 2 disadvantages of share capital? 10. Can you explain the benefits of using retained profit instead of loan capital

for a growing business?

Gymshark: from University to £500million

While still at Aston University, in 2012 friends Lewis Morgan and Ben Francis started an online

sportswear company: Gymshark. By early 2019 potential investors valued the business at £500 million.

Lewis had been bought out in 2016, so 27-year-old Ben Francis was Gymshark’s owner – and the one set to make a fortune.

Gymshark began when fitness-geeks Lewis and Ben saw an opportunity for design-led, high-tech

alternatives to the ubiquitous Adidas and Nike sportswear. Clever use of social media and a well-

designed, youthful logo and website helped the business to be profitable almost from the outset. As

early as 2014 the online-only business made £1 million of operating profit. The firm, which has five

million followers on Instagram and 260 staff, sends free products to social media influencers around the world who often later share pictures of themselves working out wearing the gear.

“Our overarching focus, full stop, is to understand the 18-25 age group in our sector better than any

brand in the world,’ says Francis. “For this generation, it’s all about the experience and emotion. Price

matters but more importantly it’s about being part of something”. Gymshark also pulls in 14-year olds,

its customers of the future.

At 60% of sales, the U.S. is Gymshark’s biggest market. The UK comes in second at 25%, followed by the

European Union at 15%. Australia and Canada are growing markets – Gymshark switched on its

Australian online store in July 2017. 2018 and 2019 have seen online stores opening in Russia, India,

Japan and South America.

So far, all production has taken place in the Far East. This has kept costs low enough to provide high

added value and profits from every sale. But the company says it wishes to switch to Portugal and other

European production locations. Its huge profitability and worldwide sales potential means it has

nothing to fear from Brexit.

Questions: (15 marks)

1. Analyse the methods Gymshark has used so far to achieve its dramatic business growth. (6)

2. To maintain its high growth rate Ben Francis thinks that Gymshark should raise an extra £50m of

external capital.

Option 1 is to raise this from loan capital

Option 2 is to raise this from share capital.

Justify which one of these two options Ben Francis should choose. (9)

8.712.8

40.5

103.1

1.13 1.1 8.15

17.61

0

20

40

60

80

100

120

2015 2016 2017 2018

£millions

Gymshark Ltd financial performanceSource: Gymshark Ltd accounts, Companies House

Salesrevenue

Profitbefore tax

Session 2 - Change in business aims and objectives

Q1 Fill in the gaps As a business _________________ and grows, its _______________ and objectives can ____________________. This may happen as a response to a change in ______________ conditions, developments in ________________________, how well the business is performing, ___________________ and for reasons within the business, known as _____________________ reasons.

Choose from: technology; market; aims; internal; evolves; change; legislation

Q2 Match it! Match the reason why business aims and objectives may change to the relevant explanation

2.1 Changing market conditions a. When business costs increase and profit goes down 2.2 Changing technology b. When a new management team take over control

2.3 Changing performance c. When a competitor increases its market share

2.4 Internal reasons for change d. When e-commerce sales became increasingly popular

Q3 True or false? Identify if the following statements are true or false

True False

3.1 A business experiences a drop in profits, is an example of business aims & objectives changing due to….changing technology

3.2 A new chief executive officer is appointed, is an example of why business aims and objectives may change due to… internal reasons

3.3 The development and growth of m-commerce, is an example of why business aims and objectives may change due to… changing performance

3.4 A new competitor enters the market, is an example of why business aims and objectives may change due to… changing market conditions

Q4 Match it! Match the aim/objective with the relevant business example

4.1 Focus on survival a. When Marks & Spencer decided to close all of its

stores in France

4.2 Focus on growth b. When Morrison’s reversed its decline in sales

4.3 Entering markets c. If Lloyds Banking Group decide to make redundancies

4.4 Exiting markets d. If Apple introduce a new iPhone

4.5 Growing the workforce e. If Aldi decides to open stores in China

4.6 Reducing the workforce f. When Tesco cut one third of its products from its supermarket shelves

4.7 Increasing the product range

g. If Lidl decides to open 250 new stores in the UK

4.8 Decreasing the product range h. If Domino’s recruit more employees

Q5 What’s your opinion? Answer the following questions, justifying briefly your opinion

5.1 Why might Lidl decide to open stores in the USA?

5.2 Why might Apple introduce a new iPhone into its produce range?

5.3 Why might the Lloyds Banking Group decide to make redundancies?


1. Can you give 2 factors that affect a company’s aims and objectives. 2. Can you explain how an increase in competitiveness of a market may affect a business’s aims

and objectives. 3. Can you explain why changes in technology could affect a business’s aims and objectives. 4. Can you explain why changes market conditions could affect a business’s aims and objectives. 5. Can you explain why changes in legislation could affect a business’s aims and objectives. 6. Can you give 2 examples of how a business’s aims and objective might change as it grows. 7. Can you explain how a business aims and objectives can change as a business increases its

product range. 8. Can you explain how a business aims and objectives can change as a business decreases the

size of its workforce. 9. Can you explain how a business aims and objectives can change as a business enters a new

market. 10. Can you explain how a business aims and objectives can change as a business survives.

Disposable profits

In 2005, the market for disposable nappies was bigger in Britain than China; even though China’s

population was 20 times greater. U.S. giant Procter & Gamble spotted that the market in China was

growing, and launched its Pampers brand. By 2005 Pampers had nearly 50% of what was still a

small market.

One British entrepreneur saw a huge opportunity. He had spent time in China, and noticed that

parents would pay a lot extra to get foreign baby food, baby milk and nappies. With one child per

family the norm in China, parents lavished all they could on their kid. Jim Foulkes persuaded

Japanese nappy producer Kao to launch into China at prices 50% higher than Chinese-made

Pampers. The advertising focused on the obsession with quality at Kao’s Japanese factory. The move into China was a big step for Kao, which had always been a cautiously-run business.

Kao has benefited hugely from its initiative. Today, Procter & Gamble’s market share in China is

down to 22% and Kao has 12%. With Kao’s high prices, this business is hugely profitable – and 12%

of the world’s biggest market for nappies is quite something. Jim Foulkes saw the way the global nappy business was turning to China – and found the right opportunity.


1. Outline why Kao might export its goods rather than open a new factory overseas. (2)

2. Analyse how Kao might have benefited from switching its objectives towards growth. (6)

3. In future, Kao wants to grow further by moving into a new country. They are considering one option:

Option 1 To launch products into the long-established UK market.

Option 2 To move into the market in India.

Justify which one of these options Kao should choose. (9)

7084

6100

1022

9954

0

2000

4000

6000

8000

10000

12000

$billionsSales of disposable nappies by country 2005-2019

Source: Euromonitor 2019; 2019 figures are Euromonitor estimates

USA

China

UK

India

Session 3 - Business and Globalisation

Q1 Fill in the gaps A key feature of ___________________________ is when more and more goods and services are bought and sold ____________________________. The growth of the internet and ______-_____________________ has meant that many businesses, including small firms, can now sell their products relatively easily abroad. UK businesses now have the opportunity to ______________________ their goods and services to ________________________ markets, ________________________ abroad and take advantage of lower labour _________________. However, it also means UK businesses face more and more competition from foreign _______________________.

Choose from: costs; export; internationally; overseas; globalisation; imports; locate; e-commerce

Q2 Match it! Match the key term to the correct definition

2.1 Imports a. good or services made in one country and then sold to a

different country

2.2 Exports b. a business that has operations in more than one country

2.3 Multinationals c. goods or services which are bought from overseas

Q3 Importer or exporter? Identify whether each of the following UK businesses is acting as an importer or an exporter

Importer Exporter 3.1 A UK business sells aircraft to an airline in France 3.2 A UK business buys coal from the USA 3.3 A UK business buys t-shirts from a business in Vietnam 3.4 A UK business sells luxury cars to the Chinese market

Q4 Benefit or drawback? Identify if each of the following statements are a benefit or a drawback of globalisation to UK businesses

Benefit Drawback 4.1 Increased costs of transporting goods to the end customer

4.2 Cost reductions made could lead to higher profits

4.3. Opportunity to increase sales and expand abroad

4.4 Can be seen as unethical if production is moved to low wage countries

4.5 Opportunity to become a global brand

4.6 Products may have to be changed to meet consumer tastes in other countries

4.7 New and bigger markets for its goods and services

Q5 True or false? Identify if each of the following statements are true or false True False 5.1 A business may relocate its manufacturing abroad to benefit from lower

labour costs

5.2 A business may locate its operations abroad in order to avoid import tariffs 5.3 A UK business may build a factory abroad because the land in the UK is very

expensive

5.4 A business may experience bad publicity if UK production jobs are lost when it moves its operations abroad


1. Can you define the term ‘globalisation’? 2. Can you define the term ‘imports’? 3. Can you define the term ‘exports’? 4. Can you identify 2 ways a business can benefit from globalisation? 5. Can you explain 2 ways a business may face barriers to international trade? 6. Can you state the name is given to a single business operating more than one country? 7. Can you define the term ‘tariffs’? 8. Can you define the term ‘trade blocs’? 9. Can you list three trade blocs? 10. Can you explain 1 reason why a business may need to change its marketing mix when it starts

selling its products in a different country? 11. Can you explain an advantage of e-commerce for an international business?

Tariffs and Trading blocs

In 2018 America’s President Trump surprised the world by putting trade tariffs on a series of goods from

China and Europe. This started a trade war with China that is not yet over. When big countries are using

trade tariffs, it can be a comfort to operate within a trading bloc such as the European Union or ASEAN – the

Association of South-East Asian Nations. The main 7 of the ASEAN countries are shown in Table 1, with an

indication of their recent economic success. The ASEAN countries have a total population of 650 million,

compared with 510 million in the European Union.

Trading blocs are popular globally because they act as a business club, in which the members can deal with

each other on favourable terms. The UK’s decision to ‘Brexit’ is unusual in a world where many countries

are trying to form or join blocs such as ASEAN. At the moment 5 countries are in the process of applying to join the E.U.

ASEAN’s success can be traced back to a brilliant decision made in 2010: to agree a free trade area with

China. So countries such as Cambodia and Vietnam can benefit from China’s remarkably long-lived growth

story.

For an individual business the benefits of a trading bloc are clear. As long as your factory is located in one of

the bloc countries you will be able to trade tariff-free within the bloc. So whereas outsiders may have to pay

a tariff of 10%, you are paying nothing. For a car producer such as Honda, factories in Thailand and Vietnam make sure that it is able to compete internationally as it has no tariffs to pay within ASEAN countries.

Table 1. % annual growth rate for main ASEAN countries (per capita, i.e. excluding population growth).

China and World figures are there for comparison.

The 7 main ASEAN countries

Cambodia Laos Philippines Malaysia Singapore Thailand Vietnam China World

2003 6.7 4.5 2.8 3.7 6.1 6.4 5.9 9.4 1.6

2008 5.1 6.0 2.4 2.8 -3.4 1.2 4.7 9.1 0.6

2013 5.6 6.4 5.3 3.3 3.1 2.2 4.3 7.2 1.45

2018 5.9 4.9 4.8 3.3 2.7 3.8 6.0 6.1 1.9


1. Outline one benefit of a trading bloc for a business like Jaguar Land Rover (2)

2. Explain one benefit of importing goods from abroad. (3)

3. Analyse whether the information in Table 1 shows that the ASEAN trading bloc has been successful. (6)

4. Jaguar Land Rover (JLR) has a factory in China as well as several in the UK. For its next expansion JLR

wants either to open a factory within the ASEAN region or to open one in India, outside ASEAN.

Justify which one of the options they should choose. (9)

Session 4 – Ethics, the environment and business

Q1 Fill in the gaps Ethics is about what is __________________ right and _________________. When businesses act in a way that _____________________ consider fair and honest, they are said to be displaying ethical _____________________. Businesses may face situations where there is a possible trade- off between ethics and _______________. Profit is often a key objective that businesses set however, firms may also consider the __________________ when making ___________________. Environmental considerations can influence business activity, such as making sure it uses ______________________ resources in manufacturing and meets _____________________ requirements. However, businesses have to accept that there is a trade-off again between the ____________________, sustainability and profits. In addition, businesses need to be aware of ______________________ group activity and the impact this can have on its ________________________mix, for example ensuring that product packaging is 100% recyclable. Choose from: profit; marketing; environment; pressure; environment; morally; legal;

sustainable; behaviour; wrong; stakeholders; decisions

Q2 Match it! Match the business to the relevant example of ethical behaviour

2.1 A chocolate manufacturer could behave ethically by…

a. paying its employees above the living wage

2.2 A clothes retailer could behave ethically by…

b. paying its food suppliers a fair price and on time

2.3 A furniture manufacturer could behave ethically by…

c. operating a clothes recycling scheme in store and donating the items to charity

2.4 A food retailer could behave ethically by… d. buying cocoa beans from farmers who work in safe conditions

2.5 A supermarket chain could behave ethically by …

e. buying wood from forests which protect the habitats of wildlife

Q3 Benefit or drawback? Identify whether each of the following statements are a potential benefit or drawback to a business that acts ethically

Benefit Drawback

3.1 Improves reputation

3.2 Higher costs

3.3 Encourages potential investors

3.4 Training costs may increase

3.5 Increased sales

3.6 Improves employee motivation

3.7 Greater brand awareness

3.8 Profits potentially reduced

Q4 Cost or benefit? Identify if each of the following is a cost or a benefit to a business of accepting greater environmental responsibility…

Cost Benefit 4.1 Helps to promote the business 4.2 Costs may be increased 4.3 Reputation and image can be improved

4.4 Increased profit as customers may be prepared to pay a higher price

4.5 Harder to compete with other businesses if prices increase

4.6 Training costs may increase

4.7 Loss of customers if prices increase

4.8 Savings can be made e.g. by recycling waste

Q5 Which “P”? State the element of the marketing mix each of the following changes would specifically relate to

Product, price, promotion or

place? 5.1 A UK furniture manufacturer decides to produce all of its products in

the UK, cutting delivery times and reducing carbon emissions

5.2 A supermarket chain increases the price of its reusable carrier bags in order to donate more money to charity

5.3 A high street clothes retailer advertises the fact that it will donate £1 to the World Wildlife Fund for every item of clothing bought in store in April

5.4 A pizza delivery business makes it pizza boxes from 80% recycled material


1. Can you define the ‘ethics’? 2. Can you define the term ‘pressure groups’? 3. Can you give examples of ethical behaviour by businesses? 4. Can you identify 2 advantages of being ethical? 5. Can you identify 2 disadvantages of being ethical? 6. Can you identify 2 ways in which working ethically may improve a firm’s productivity? 7. Can you identify 2 reasons why working ethically might reduce a firm’s profit? 8. Can you identify 2 reason why working ethically might increase a firm’s profit? 9. Can you identify 1 way in which a business might change its marketing mix in response to

pressure groups? 10. Can you explain one impact to a business of being ethical?

Control climbing – the ethical start- up

On September 10th 2018 26-year-old Tom Chapman fulfilled stage one in a lifelong dream: to be

an entrepreneur. On that day he received confirmation that Control Climbing had been accepted

as a private limited company. He started the business with capital from savings (he’d been

working in a clothes shop) plus some capital from his parents. Tom had long been an enthusiastic

rock-climber: Control Climbing Ltd was to fill a gap he’d identified: for climbing wear that looked

good enough to wear to work or at night; straight from work to the rock-face.

His idea was to establish the business online-only – marketing the business through sponsored

‘ambassadors’. These would be well-known climbers who might have articles and photos in

online magazines such as ‘Climber’, ‘Outdoor Fitness’ and ‘The Great Outdoors’. All it would take

is one photo of a climber wearing a T-shirt with the Control Climbing logo (see right) and sales

could build up quickly.

Tom has worked very hard to source his products ethically. Cottons are organic and from

sustainable sources. Manufacture is either in the UK (in which case he promises he’s inspected

the premises and made sure everyone earns a living wage) or it’s in India – but only from

factories that have passed international inspection standards. But will this dedication prove a

problem? He charges £25 for a Control Climbing T-shirt, and that price will partly have been

forced on him by his relatively high variable purchasing costs.

For now, if you put ‘rock climbing clothes UK’ into Google, there are lots of options, but no sign

of Tom’ business. If he had the finance he could buy a ‘sponsored’ spot at the top of the rankings,

but that’s not realistic financially. He needs to create excitement around the brand to climb up

those Google rankings.


1. Analyse the benefits to Control Climbing of increasing its ethical behaviour. (6)

2. Tom has two main options for boosting sales at Control Climbing:

Option 1 spend more on Google rankings,

Option 2 spend more on getting the best possible brand ambassadors.

Justify which one of these options Tom should choose (9)(9)

4. Tom has two main options for boosting sales at Control Climbing: spend more on Google

rankings, or spend more on getting the best possible brand ambassadors. Justify which one of

these options Tom should choose. (9)

Year 10 GCSE Business Ark Globe Academy Remote Learning ... 10 Business Remote... · Match each type of business growth to its correct definition 2.1 Merger a. When a business finds

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