There are many types of warehouses used in home and international trade.

Mark scheme

Marking points from the official mark scheme (May/June 2018). The mark or mark type is shown in brackets.

1. [3] (a) 1 mark for each correct answer
2. [3] (a) Cash and carry warehouses offer self-service wholesaling. TRUE
3. [3] (a) Manufacturers' warehouses would be used to store raw materials and finished goods awaiting sale. TRUE
4. [3] (a) Regional distribution centres are located at seaports for efficient distribution of goods. FALSE
5. [2] (b)(i) Any 2 x 1 marks
6. [2] (b)(i) Stores goods for seasonal production/when goods are not in season (1) goods that can be produced at only certain times of year/at that season (1) e.g. winter coats (1) can be released throughout the year (1) enabling everyone to have these goods throughout the year/demand met throughout the year/sold in off-season (1) so there are no shortages (1)
7. [2] (b)(ii) Any 2 x 1 marks
8. [2] (b)(ii) By buying e.g. wheat at harvest time (1) could place wheat into cold storage warehouse/goods into warehouse (1) and releasing it gradually over the year (1) to avoid shortages (1) meeting demand (1) storing goods when there is low demand/when prices are low (1) releasing goods when there is high demand/when prices are high (1) so the wholesaler can reduce the wider price fluctuations/maintain prices/preventing prices from going up (1)
9. [6] (c)(i) Up to 2 marks for describing overseas agents
10. [6] (c)(i) Up to 2 marks for analysing the reasons whether (or not) to use overseas agents
11. [6] (c)(i) Up to 2 marks for evaluating whether or not an agent should be used to sell goods overseas.
12. [6] (c)(i) Reasons for using agents:
13. [6] (c)(i) the business is able to concentrate on other aspects of the business – that may otherwise have been neglected
14. [6] (c)(i) agents should be experts at this work and will introduce the business to potential buyers – leading to increased sales
15. [6] (c)(i) agents will have the necessary expertise in what they are selling and what the local consumers are likely to demand as they will have a network of contacts – thereby reducing risk of failure
16. [6] (c)(i) agents assume responsibility for transporting / customs clearance – which saves the business time
17. [6] (c)(i) it cuts down the need to travel to overseas markets - and the time saved can be used for other purposes
18. [6] (c)(i) Solves the problem of not being sure whether they will receive payment for goods - from an unknown customer
19. [6] (c)(i) Reasons against using agents:
20. [6] (c)(i) agents may not be as interested in the success of his business as the owners are
21. [6] (c)(i) agents will charge commission or pay less for the products – than if the business was selling directly
22. [6] (c)(i) they may not be exclusive – as they may have more favoured clients that they promote
23. [6] (c)(i) agents will need to be supervised – as they may carry out unethical practices
24. [6] (c)(i) Example of evaluation: Yes, a business should use agents as there will be no need to recruit and train new employees for this role which would take time and money.
25. [2] (c)(ii) 1 mark for correct trade restriction and 1 mark for description
26. [2] (c)(ii) Tariff/customs duty (1) tax on imports (1)
27. [2] (c)(ii) Embargo (1) ban on goods (1)
28. [2] (c)(ii) Quota (1) limit/reduction on amount of goods imported (1)
29. [2] (c)(ii) Licence (1) permission for importer/exporter to trade (1)
30. [2] (c)(ii) Subsidy (1) form of financial aid/grant (1)
31. [2] (c)(ii) Exchange control (1) limiting foreign exchange purchases (1)