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A-LevelBusiness StudiesBusiness financeFeb/Mar 2017Paper 2 Q231 Marks

Clean and Tidy (CT) CT is an employee-owned business that specialises in cleaning homes. The homes are cleaned during the day whilst the homeowners are at work. There are nine employees, each of whom owns an equal share of the business. CT cleans 50–60 homes each week. Most customers have been using CT for many years. There has been no sales growth for the past 12 months and the profit margin is decreasing. CT has tried to increase revenue by lowering the price of its services (see Table 2). [Table 2: Sales data] Price per hour Weekly sales (number of homes cleaned) $8 50 $6 55 CT promotes its cleaning services using above the line promotion methods. New customers contact the business through its website or by telephone. In a recent meeting of all the owner-employees, someone suggested the business move into the industrial market for cleaning. This would include cleaning offices and factories during the night. The marketing mix for CT would need to be changed significantly to attract customers in the industrial market.

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About This A-Level Business Studies Question

This structured question appeared in the Cambridge A-Level Business Studies (9609) Feb/Mar 2017 examination, Paper 2 Variant 2. It tests the topic of Business finance and is worth 31 marks.

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