Fig. 4.1 is an email replying to an enquiry sent by Kito who manufactures greeting cards. [Figure 4.1 email]

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2019). The mark or mark type is shown in brackets.

1. [2] Where goods and services are bought and sold/traded/exchanged (1) worldwide/internationally/different countries (1)
2. [3] Yes – sent immediately/quickly (1) 24/7 (1) cheap (1) can be seen on a number of devices (1) has written details (1) can be used as reference/legal proof (1) Exporting Advice Centre offers responses by email (1) could attach documents (1) and sent to multiple addresses (1); No - email may not be read immediately/replied to (1) personal discussion easier on telephone (1) get more information more quickly on telephone (1) internet/network connection issues (1) email be deleted by mistake (1)
3. [2] Text is not too small/easy to read; Relevant information/up-to-date; User friendly/easy to navigate/easy to find/access information; Use of good graphics/images/colour; Contact information; Security/trustworthy; Social media links; FAQ
4. [4] Distance (1) makes it difficult to establish close trade contacts between traders (1); Language (1) price lists / advertisements may need translation (1); Communication (1) face-to-face may be expensive (1); Risk in transit (1) foreign trade involves much greater risk than home trade because goods have to be transported over long distances e.g. perils of the sea (1); Lack of information about foreign traders (1) more difficult to establish creditworthiness of foreign buyers / higher credit risk / greater risk of bad debts (1); Customs duties/tariffs (1) tax on imported goods increases cost (1); Quotas (1) limit on imported goods so may not be able to buy as many as wanted/needed (1); Documentation (1) exporters have to prepare several documents which involves extra time and money (1); Foreign markets (1) can be difficult to learn about / collect up-to-date information on these new markets (1); Currency (1) every country has its own currency and the rate at which one currency can be exchanged for another fluctuates making transactions more complicated (1); Weights and measures (1) e.g. may have to convert kilograms into pounds (1)
5. [6] Up to 2 marks for describing the use of warehousing for greeting cards
6. [6] Up to a further 2 marks for analysing the importance of warehousing for greeting cards
7. [6] Up to a final 2 marks for evaluating how important warehousing will be to Kito
8. [6] Warehousing may become more important to Kito due to increased demand from new export customers – if he does decide to export. Greeting cards are produced all year round, although some demand is seasonal, so constant storage will be required. A warehouse will protect stocks of cards from damage/theft/weather and can also be used for processing, e.g. packaging/branding/labelling. But, warehousing is a cost to the business and can be expensive. If Kito decides to export he may well need increased storage capacity before he receives the income from his export sales.
9. [6] Evaluation example: It mostly depends on security and if Kito decides to export. If he does export, he will need a safe place to store his greeting cards at the port to await arrival of ships to take them abroad. If it is not in a secure warehouse, his stock could be stolen or damaged and he would lose money. Also, his customers may not receive their cards in time and would not see Kito as a reliable supplier.