EDEXCEL GCSE BUSINESS · PAPER 2
Exam Practice: Place
Place · Making marketing decisions · Lesson 4 of 5 · 12 marks · 20 minutes
Name Date
Answer all questions. Use the context of the business in the question where one is given.
Question 1 DEFINE [1 mark]
Define the term 'e-tailer'.
Question 2 OUTLINE [2 marks]
Outline one disadvantage to a producer of selling through a wholesaler.
Question 3 EXPLAIN [3 marks]
Explain one benefit to a business of using multi-channel distribution.
Question 4 ANALYSE [6 marks]
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SOURCE Tidal Beauty Ltd makes natural skincare products. It currently sells only through its own website. A national chain of chemists has offered to stock its products in 300 stores, but would take 40% of the retail price. |
Analyse the impact on Tidal Beauty Ltd of selling its products through the chain of chemists.
Answers
Check your answer only once you have written one.
Question 1 [1 mark]
A retailer that sells its products online.
▸ A business selling online / online retailer 1 mark
Question 2 [2 marks]
The wholesaler adds its own profit (1), so either the final price is higher or the producer receives less for each product (1).
▸ A disadvantage identified, e.g. lower profit / higher price / less control 1 mark
▸ Developed 1 mark
Question 3 [3 marks]
It can reach more customers (1). Some customers prefer to shop in stores while others prefer to buy online (1). By selling through both, the business meets each customer's preference, increasing its total sales (1).
▸ A benefit identified 1 mark
▸ First linked point of explanation 1 mark
▸ Second linked point of explanation 1 mark
Question 4 [6 marks]
Selling through 300 chemists would make Tidal Beauty's products available to many more customers, including those who prefer to see and test skincare in a shop before buying. This would increase awareness of the brand and could greatly increase its sales volume. However, the chain would take 40% of the retail price, so Tidal Beauty would earn much less profit on each product than it does selling direct from its website. It would also lose some control over how its products are displayed and priced. This means that although sales would rise, Tidal Beauty must sell enough extra products to make up for the lower profit on each one.
▸ AO2 (Application, 3 marks): uses the context - skincare, website only, 300 stores, 40% of the price Level 1-3
▸ AO3a (Analysis, 3 marks): chains of reasoning about sales, profit and control Level 1-3