Mrs Kadar is a cash and carry wholesaler. She wishes to stock candles to sell in her out-of-town warehouse and has received three quotations.

Mark scheme

Marking points from the official mark scheme (Oct/Nov 2021). The mark or mark type is shown in brackets.

1. [2] 1 mark for each feature
2. No credit/goods are bought using cash or credit or debit card
3. No delivery / buyers transport the goods they buy
4. Self-service
5. Wholesaler buys goods from manufacturers
6. Sell to small-scale retailers
7. Low prices / discounts
8. Wholesaler sells goods in bulk/retailer can buy in bulk
9. Wholesaler sells a variety of goods
10. Parking
11. Long opening hours
12. Restricted access / membership cards
13. [1] Reply to an enquiry/gives details of goods/prices/terms of payment/delivery
14. [4] Any 2 factors and explanation of each to a maximum of 4 marks
15. Cost/prices (1) which supplier provides lowest/cheapest price / higher profit margin / is it within her budget / best value for money (1)
16. Delivery times (1) which supplier offers faster/best delivery (1)
17. Reliability/reputation (1) which supplier can be depended upon to provide a consistent service / has she dealt with this supplier before (1)
18. Payment terms/discount (1) which supplier offers the best credit/ discount terms (1)
19. Cost of delivery (1) which supplier offers cheapest delivery (1)
20. Availability (1) are the candles required in stock (1)
21. Location (1) which supplier is nearest (1)
22. Online reviews (1) which supplier has more positive reviews (1)
23. Types/quality of candles (1) which supplier offers ones that will sell better/increase demand / burn for longer / have a pleasant fragrance (1)
24. [3] Up to 3 marks for justified reasoning of yes and/or no responses
25. Yes - the warehouse/land rents are lower (1) reduces costs (1) lower overheads (1) helps to keep prices low (1) make more profit (1) more warehouse space (1) more space for customer parking (1) less congestion (1) less pollution (1)
26. No - will not attract town centre retailers/customers (1) so sales may fall/lose revenue (1) greater distance for some suppliers to deliver to (1) increasing transport costs (1) and longer delivery times (1) Better to be located in town centres as more convenient for retailers/customers (1) likely to attract more retailers/customers (1) increasing sales/profits (1)
27. [6] Up to 2 marks for describing cash and carry warehousing/small-scale retailers
28. Up to a further 2 marks for analysing the importance of cash and carry warehousing to small-scale retailers
29. Up to a final 2 marks for evaluating whether cash and carry warehousing is important to small-scale retailers
30. A large warehouse selling goods for cash in small bulk without delivery.
31. They allow small-scale retailers to buy cheaper goods so they can compete against large-scale retailers
32. No delivery of goods reduces wholesaler's costs which they can pass on so that retailers can offer competitive prices
33. Retailers can buy the goods when required as they do not have to wait for delivery. This is useful if there is a sudden demand for goods.
34. Small-scale retailers do not need to rent a storage place as it is convenient for them to buy them from the cash and carry warehouse when the need arises.
35. Special offers are offered as incentives for retailers to buy at cheaper prices
36. Wide variety of goods are stocked giving retailers choice
37. There are long opening hours to suit retailers to visit when they have time
38. Evaluation: Small-scale retailers benefit from the immediacy that cash and carry warehouses offer, with a range of goods and competitive pricing. If the retailer has a really busy morning, they can replenish stock ready for the afternoon. Cash and carry warehouses are very important because they help small-scale retailers to survive against increasing competition.