BBB Fashions is a public limited company. It is a manufacturer of fashion clothing for women. It sells its products in both the home market and the export market.

Mark scheme

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

1. [2] (a) (i) Valid points include (Any 2 × 1 marks) • Easy to raise large capital (1) as regarded as safer/reliable to invest in (1) no upper limit (1) • Shares listed on stock exchange (1) open to the public to buy (1) • Has continuity of existence (1) passed down from generation to generation • Le.g.al entity (1) buy and sell in its own name (1) • Limited liability (1) encourages people to invest (1) Accept any other relevant points.
2. [2] (a) (ii) Up to 2 marks for one advantage • Easy to buy/sell shares (1) through stock exchange (1) • Limited liability (1) personal assets not at risk/only responsible for invested amount (1) • Publication of accounts (1) shareholders can see how the business is being run (1) • Dividends can be received (1) if profits are made (1) Accept any other relevant points.
3. [4] (b) (i) 2 marks for each difference (with 2 marks max.) for home market and 2 marks max. for export market • Home market is buying/selling within a country/internal trade (1) export market is selling to other countries/external trade (1) • Home market has wholesalers/retailers (1) export market has importers/exporters/merchants/overseas agents (1) • Home market has no customs duties/quotas (1) export market has customs duties/quotas (1) • Home market the same weights/units of length/voltage are used (1) export market uses different units of weight/measures (1) • Home market uses the same currency or example such as £ (1) whereas export market countries use different currencies or example such as the dollar • Home market has same means of payment or example cheques (1) whereas export market different means of payment are used or example such as documentary credits (1) • More complicated documents in export market trade than in home trade (1) allow e.g.s to highlight differences • Different forms of transport used or road/rail in home market (1) air/sea in export market (1) • Differences in language as in home market the same language is used or example such as English (1) whereas in export market different languages will be used or example (1) Accept any other relevant points.
4. [2] (b) (ii) 1 mark for each method identified to a maximum of two methods • Rail/train • Sea/ship • Air • Truck, if neighbouring country with land border Accept any other relevant points.
5. [4] (c) Valid points include (Any 2 × 2 marks) • Advertising (1) to persuade/inform consumers to buy/know about their products (1) • Example of an advertising media e.g. TV (1) explanation of that media/how it helps (1) • Sales (1) selling old stock (1) • Special offers/loss leaders (1) reduction of prices (1) • Sales promotion (1) e.g. BOGOF (1) • Competition (1) to encourage consumers to buy their products/win a prize (1) • Free gift (1) to encourage consumers to buy/obtain gift (1) • Special displays (1) of products/fashion shows/shop window (1) • Endorsement by celebrities (1) as a method of appeal (1) • Loyalty cards/points (1) can exchange points for goods (1) Accept any other relevant points.
6. [6] (d) Level 2 (4-6 marks) Has discussed whether or not communication is important to Amy Fashions in both its home market and export markets and has given a reasoned opinion Level 1 (1-3 marks) Has commented on communication in the home and/or export markets with/without an opinion • Written communication such as brochures and letters • Electronic communications such as telephone calls and e-mails • Prompt response to any complaints from retailers • Routine non-personal communication could be written • Electronic communication would be quicker and could be used for special offers to retailers • BBB Fashions could set up special e-mail address or phone numbers for complaints. • Communication is important and arguably the most important would be to respond promptly to complaints. Accept any other relevant points.