Business (AS & A Level) · Oct / Nov 2022 · Paper 23 · Question 2

Planting Pots (PP) Emily and Kabir are entrepreneurs. In 2012 they set up PP in country K. As the business grew, they converted it from a partnership into a public limited company. Kabir and Emily own 50% of the shares between them. PP manufactures decorated pots for plants in its factory in country K. The pots can be used indoors and outdoors. The market for decorated pots is growing in country K and the business environment is dynamic. Some market data is shown in Table 2.1. Table 2.1: Market data for decorated pots 2020 (units sold) 2021 (units sold) Total market sales in country K 3.2 m 4.1 m PP market sales 0.8 m 0.82 m PP has 90 employees. Table 2.2 shows some data about PP’s employees. Table 2.2: PP’s employee data Type of employee Payment method Main task Creative designers Piece rate Create new designs for pots Machine workers Time-based Batch production of pots Supervisors Salary Supervise creative designers and machine workers Managers Profit sharing Make decisions in functional areas The directors of PP have decided to build an additional factory. The capital cost will be $1.5 m. The additional factory will allow PP to develop its product portfolio. The construction of the factory can start as soon as the directors have decided on a source of finance. 5 10 15 20

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