Fig. 5.1 shows a warehouse owned by a large-scale retailer. [Figure 5.1] Use Fig. 5.1 to help you answer the following questions.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2020). The mark or mark type is shown in brackets.

1. [1] Regional Distribution Centre / RDC / regional centre / distribution centre.
2. [Yes 1] it stores goods; [1] which are fast-moving / require quick turnover / new goods; [1] which have to be delivered to stores quickly; [1] e.g. perishable goods; [1] so that they are fresh / do not deteriorate; [1] e.g. seasonal goods; [1] when demanded; [1] resulting in speedy stock clearance; [1] so that stores do not have empty shelves / consumers do not have shortages; [1] increasing the number of times stock is sold / replaced.
3. [No 1] slow-moving / bulky goods may block the warehouse; [1] and expensive goods take longer to sell; [1] blocking other goods from moving through into the warehouse.
4. [1] Lower prices / discounts; [1] saving consumers money / use of own brands / economies of scale / allow example
5. [1] Technological effects; [1] online shopping / quicker ways of shopping / self-service checkouts
6. [1] Wider range of products; [1] more choice / to satisfy needs and wants / different manufacturers / international brands
7. [1] Use of self-service; [1] freedom of choice / decline of personal service
8. [1] Save time; [1] one-stop shopping
9. [1] Using loyalty cards; [1] consumers accumulate points / leads to some shoppers becoming regular shoppers at these stores
10. [1] Changes in consumer buying habits; [1] longer opening hours
11. [1] Closure of smaller shops / town centres with empty shops; [1] consumers have less choice / have to travel further / visit shopping malls
12. [1] More / better facilities / services; [1] example e.g. toilet, café, parking.
13. [1] Factory outlets sell directly to consumers. TRUE
14. [1] An omnichannel retailer keeps customers informed about the progress of their orders. TRUE
15. [1] Supermarkets have a low rate of sales turnover. FALSE
16. [Up to 2 marks] for describing large-scale retailers / delivery fleet
17. [Up to a further 2 marks] for analysing benefits of owning its delivery fleet
18. [Up to a final 2 marks] for evaluating the benefits of owning its delivery fleet.
19. Large-scale retailers use transport to move goods to its stores. It needs to do this in good time to satisfy consumers' demands. Most large-scale retailers will distribute goods by road.
20. Owning the fleet means less documentation is needed compared to using a transport company
21. Better customer service as there will be direct contact with customers so that their needs / problems can be sorted out quickly
22. Goods will be better supervised as the retailer will have its own drivers which should mean less chance of theft / damage
23. Delivery times can be arranged with the stores so more flexible timings compared to timetables of some transport companies e.g. to allow for last-minute deliveries
24. The large-scale retailer will be able to buy specialised vehicles to suit the company's needs e.g. refrigerated trucks
25. Greater reliability so less delays
26. Reinforcing the brand by placing adverts on the side of the trucks e.g. logo / details of business, so saving on marketing; these cost savings can be passed on to customers in lower prices making them even more competitive in the retail market
27. More economic if there are regular loads as the profit margins enjoyed by transport companies are eliminated
28. Trucks can be hired out so the retailer will receive income.
29. Evaluation: Although there will be a high capital cost initially and on-going high running costs, large-scale retailers will be able afford this and there are more other benefits from owning its own fleet than using a transport company.