A construction company is planning to build a retail shopping centre on the outskirts of a large town.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2014). The mark or mark type is shown in brackets.

1. [2] Any two features × 1 mark each • A wide range of shops • Car parking • Other facilities e.g. snack bars • Easy walking / space to move around / less traffic • Everything under one roof • Entertainment e.g. cinemas • Security • Easy access • Long opening hours • Billboards to sign the shopping centre • Special promotions for opening. Any other relevant point. Low prices / self-service = 0 marks.
2. [4] Any two reasons × 2 marks each • They provide a range of shops that will attract a variety of customers • They have small and large units available for a range of retailers • They attract a large number of customers and so the retailers may increase their sales • The small-scale retailers hope that the attraction of large-scale retailers will increase their trade • They can take advantage of good security arrangements and so feel that their businesses are safe • They benefit from the advertising of the shopping centre as a whole which may be better known than some of the individual shops • The shopping centre provides them with an attractive venue that will attract customers to satisfy a range of needs and wants. Any other relevant point.
3. [4] Any two ways explained × 2 marks • Introduce special offers such as buy one, get one free / loss leaders • Lower prices to dispose of more stock and so increase sales • Look for other goods to sell that may attract more customers • Change to cheaper suppliers so reducing cost of goods sold • Look for goods that offer better value for money and quality so that they appeal to customers • Advertise (although shopping centre advertises itself) using various media / examples • Offer credit to give competitive edge • Offer longer opening hours to give more opportunities for shopping. Any other relevant point.
4. [1] One mark for buildings / fire / theft / motor / consequential loss / public liability / employer's liability / accident / product liability. Any other relevant risk.
5. [3] Any three points × 1 mark each • Business failure is a non-insurable risk • There are no past records on which to calculate the risk and set a premium • May deliberately make the business fail in order to collect compensation • Because insurance companies do not offer cover for this. Any other relevant point.
6. [6] Level 2 (4-6 marks) Has discussed both informative and persuasive advertising in relation to the opening of the retail shopping centre and has given a reasoned opinion. (If a candidate has discussed either informative or persuasive advertising with a reasoned opinion, award 4 marks max) A new shopping centre needs to advertise itself in order to make itself known to as wide an audience, of potential consumers, as possible. It will need to give details of where it is located, when it opens, its opening times, the facilities it offers and the kinds of shops it has. This is all information and so the shopping centre will have to undertake informative advertising. It is in competition with other kinds of shopping e.g. town centre shopping and online shopping so it will need also to undertake some persuasive advertising in order to tempt consumers to visit it. It may offer incentives to come such as competitions or vouchers to spend in some of the shops. This is all designed to encourage consumers to come to the shopping centre and also to return. It may concentrate on informative advertising with some persuasive advertising as back-up. It would expect some of the large-scale retailers (who have taken space in the shopping centre to advertise) to undertake advertising to persuade people to shop there. This in turn would help to advertise the shopping centre. Therefore, it is important to advertise the shopping centre and to undertake both informative and persuasive advertising. Level 1 (1-3 marks) Has commented on informative / persuasive advertising in context / without context and has / has not given an opinion. A new shopping centre needs to advertise itself. It needs to make itself known to consumers. It will need to give details of where it is, its opening times, the facilities it offers and the kinds of shops it has. The shopping centre should use informative advertising. It is in competition with other kinds of shopping. It will also need to undertake some persuasive advertising. Otherwise it will not attract customers. It may need to use persuasive advertising when it is open.