Business (AS & A Level) · May / June 2026 · Paper 22 · Question 2

Zorba’s Flowers (ZF) Zorba had always had a passion for flower arranging. When he was made redundant from his job as an engineer last year, he decided to use all of his savings to set up a flower shop called ZF. Although Zorba did not require any additional finance, he decided to write a business plan before setting up ZF. Table 2.1 shows an extract from his business plan, showing the planned expenditure for ZF. Table 2.1 Planned expenditure for ZF expenditure $ fixtures and fittings for the shop 10 000 rent (per month) 5 000 employees (per month) 3 000 inventory (per month) 7 000 delivery van (one needed) 20 000 Zorba opened ZF at the start of January 2026. However, Zorba encountered a number of problems with Supply Chain Management during the first three months of ZF’s trading. These included: • Changeable weather conditions meant that Zorba could not always guarantee which types of flowers would be available. • ZF was often forced to work over-capacity at times of high demand. • The inventory is perishable and can be easily damaged when transported. At the end of the first three months of trading, Zorba realised that he had no working capital left. The problem was that he had not been effectively managing his trade payables. 5 10 15 20

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