Desiree is a sole trader who owns a flower shop. She buys the flowers from a wholesaler and designs and arranges them for special occasions, such as birthdays and weddings. Many of her customers place orders through the shop's website.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2016). The mark or mark type is shown in brackets.

1. [4] (a) 1 mark for each factor stated with a further 1 mark for each explanation up to a maximum of 2 (Any 2 × 2 (1 + 1 marks))
2. • Proximity to wholesaler (1) to reduce costs/transport flowers quickly (1)
3. • Nearness to market (1) where there is demand/footfall (1)
4. • Near centre/rail station/car park/transport facilities (1) accessible to people to get there (1)
5. • Proximity to wedding venues (1) where there is a market (1)
6. • Personal factors (1) where the owner wishes to live (1)
7. • Good communications (1), e.g. wi-fi available (1)
8. • Cost of land/shop (1) is rent/lease affordable (1)
9. • Supply of labour (1), e.g. gardener (1)
10. • Security of area (1) in case of theft (1)
11. • Near power/utilities (1) for shop heating/lighting (1)
12. • Competition (1) where there are fewer similar flower shops (1)
13. Accept any other relevant points.
14. [4] (b) 1 mark for stating a reason with 1 further mark for an explanation up to a total of two reasons
15. • Wholesalers will purchase flowers from the home country/abroad in large quantities (1) giving variety of flowers (1) giving choice (1)
16. • They will break bulk (1) so supplying a small retailer like Desiree with the quantity she requires/small quantities (1) cheaper (1)
17. • Wholesaler can provide advice (1) to Desiree in areas such as consumers' taste and trends (1)
18. • Wholesalers will provide transport/deliver (1) fresh flowers directly to Desiree cutting her transport costs/offer free delivery (1)
19. • Wholesalers has warehouse (1) reducing these costs for Desiree (1)
20. • Can provide credit (1) so she can pay later (1)
21. • Wholesalers may offer trade discount (1) this enables Desiree to make a profit/making it cheaper for her (1)
22. Accept any other relevant points.
23. [2] (c) Valid points include (Can be 2 × 1 or 1 × 2 marks)
24. • Desiree may add value to the flowers purchased by arranging the flowers (1) in attractive displays (1) putting them into vases (1) adding different types of flowers (1)
25. • She may add delivery to her service (1)
26. • Attractive packaging will also add value (1) by improving presentation (1)
27. • Add branding (1) by use of name/label (1)
28. Accept any other relevant points.
29. [4] (d) Up to 2 marks for explaining one advantage and up to a further 2 marks for explaining one disadvantage
30. Advantages
31. • The orders can be received 24/7 (1) receiving orders when the shop is closed (1) and can be filled as soon as Desiree arrives (1)
32. • There is a written record of the order (1) on the computer in case of a complaint (1)
33. • Payment can be made on the computer (1) and confirmed before the order is despatched (1)
34. • Orders can be received immediately (1) with quick despatch of flowers (1)
35. • Cost-saving (1) as less staffing required (1)
36. • Able to advertise (1) with pop-ups/on website (1)
37. • Global communication (1) reaching people in distant places (1)
38. Disadvantages
39. • She has to pay a fee (1) when the customer uses a credit card (1)
40. • Websites can breakdown/poor internet connection (1) leading to delays in receiving orders (1)
41. • Need transport/courier (1) for delivery of online orders (1)
42. • Security is a problem (1) and credit card fraud may occur (1)
43. Accept any other relevant points.
44. [6] (e) Level 2 (4-6 marks) Has discussed whether or not Desiree should deliver the goods herself or use a courier and has given a reasoned opinion (If a candidate has presented a one-sided argument, award 4 marks max.)
45. Level 1 (1-3 marks) Has commented on delivering the goods herself and/or using a courier with/without an opinion
46. • Using courier will mean Desiree does not have to incur capital expenditure of buying a van or use an employee to deliver the flowers. If she delivers the flowers herself this will shorten the time available for other duties.
47. • Using her own van will probably work out cheaper in the long run. She will have more control over the quality of the delivered products and have direct contact with the customer. The van can be used to advertise the shop.
48. • Evaluation will give recommendation based on costs versus benefits and supported by reasoned judgement.
49. Accept any other relevant points.