Business (AS & A Level) · Feb / March 2021 · Paper 22 · Question 1

Flora’s Fitness (FF) Flora is a self employed personal trainer and she trades as Flora’s Fitness (FF). She invested $10 000 as start‑up capital. She has seen reports showing that keeping fit is becoming a trend in country P. ABC is a national bank with a focus on corporate social responsibility (CSR). Flora thinks there is an opportunity to provide group fitness sessions to employees at ABC’s head office. These sessions could include exercises and stretching techniques. She could also offer yoga and other fitness related classes. These sessions would allow ABC to promote itself as a ‘healthy employer’. Flora is keen to show the benefits of fitness sessions to ABC. A survey has shown that many employees do not currently visit gyms or fitness centres. High prices and lack of time are given as the most important reasons. She has arranged a meeting with John, the Human Resource Director at ABC. He is interested in offering fitness sessions as a fringe benefit for employees. He has asked Flora to provide a business proposal for the meeting. She plans to provide one session before work and one session at lunchtime five days per week. Flora proposed two pricing strategies (see Table 1.1). Table 1.1 – Proposed pricing strategies Pricing strategy 1 Pricing strategy 2 Price per person $5 Total price per session $75 Maximum 20 people per session Maximum 20 people per session 5 10 15 20

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