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Business Studies · Oct / Nov 2020 · Paper 12 · Question 1

0450

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Kolo owns a successful hairdressing salon in the city centre. He has 4 part-time employees. The business has made a profit in each of the last 3 years. Kolo wants to expand by opening another 1 hairdressing salon to take advantage of the economic boom. He plans to recruit a manager for the second salon using external recruitment. Kolo has identified 2 possible candidates for the position. Information about them is shown in Table 1.1. Table 1.1 Extract from Kolo’s information on the two candidates Candidate 2 Candidate 1 20 years experience 5 years experience Experience: Basic hairdressing certificate Advanced hairdressing certificate Qualifications: Uses autocratic leadership style Never managed a salon Other information:

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  • 1(a)[2]

    Identify two features of an economic boom. Award 1 mark per feature. Points might include:

    Rapid/fast increase in GDP/highest GDP
    Increase in prices/high prices/inflation
    High levels of demand
    (Very) low unemployment/shortage of skilled workers
    Increase in wages/high income/standard of living at highest
    Increase in/high business profits/profit at its highest
    Increase in/rising business costs
    Significant/high levels of business investment
    High capacity utilisation/increase in business output
    Increase in number of business start-ups Other appropriate responses should also be credited. 2 Only award the first two responses given. Do not award ‘high GDP’ as this is associated with economic growth.

  • 1(b)[2]

    Identify two stages of the recruitment process. Award 1 mark per stage. Two from:

    Job analysis/identify a vacancy
    Job description
    Person/job specification
    Advertising (the vacancy)
    Application forms sent out/ received
    Shortlisting/screening
    Interview/ testing
    Selection/job offer 2 Only award the first two responses given. Note: Answer must be from the business viewpoint not the applicant e.g. CV or letter of application [tv] Notes

  • 1(c)[4]

    Outline two possible advantages to Kolo of recruiting a manager. Award 1 mark for each relevant advantage. Award 1 mark for each relevant reference to this business. Points might include:

    Reduce Kolo’s workload/ can delegate tasks/ share responsibility [k] as would need to manage two businesses [app]
    Can provide new ideas / experience / skills [k] about hairstyles [app]
    Can motivate / inspire others [k] such as the 4 employees [app] Other appropriate responses should also be credited. 4 Note: To use words from the stem as application, the reference must be appropriate (i.e. make sense) in relation to the point being made. The following words are likely to be appropriate for this question:
    Hairdressing or examples such as hairstyles, shampoo
    (2)

    salons / second /new business

    4 (employees)
    City (centre)
    Make a profit in each of the last 3 years
    Economic boom Other appropriate examples in context can still be credited. Notes

  • 1(d)[6]

    Explain two reasons why choosing the right location for the new salon is important for Kolo. Award 1 mark for identification of each relevant reason (max 2). Award 1 mark for each relevant reference made to this business (max 2). Award 1 mark for each relevant explanation (max 2). Points might include:

    Help attract customers/number of potential customers/close to customers/level of income/target market [k] who want their haircut [app] increasing revenue/allowing it to break-even [an]
    Proximity to competition/may be loyal to another business [k] so may have to lower prices [an]
    Have good access/easy to find/space for parking [k] leading to more sales [an]
    Rent [k] as likely to be expensive in the city centre [app] will increase his fixed/total costs [an]
    Distance to other salon [k] as if far away, will increase transport cost [an]
    Help attract employees/close to employees [k] as it is economic boom [app] it might be difficult to find (suitably) skilled people [an]
    Provide safe/low crime environment/security [k] as otherwise customers may not wish to visit [an]
    Location has to match its brand image [k]
    Meet legal controls/government influence [k] otherwise could create a bad reputation [an] Other appropriate responses should also be credited. 6 Note: To use words from the stem as application, the reference must be appropriate (i.e. make sense) in relation to the point being made. The following words are likely to be appropriate for this question:
    Hairdressing or examples such as hairstyles, shampoo
    City (centre)
    4 (employees)
    2 businesses / second business
    Make a profit in each of the last 3 years
    Economic boom Other appropriate examples in context can still be credited. Do not award ‘salon’ as application as stated in question. Some points can be awarded as either [k] or [an] but only allow once. Notes

  • 1(e)[6]

    Do you think experience is the most important factor for a business to consider when recruiting a new manager? Justify your answer. Award up to 2 marks for identification of relevant issues. Award up to 2 marks for relevant development of points. Award 2 marks for justified decision as to whether experience is the most important factor for a business to consider when recruiting a new manager. Points might include: Experience

    Experienced person may expect higher wages [k] increasing labour costs [an]
    Experienced person is likely to make fewer mistakes [k] so business may be able to provide better service/more efficient [an] increasing brand loyalty [an]
    Business know they have shown they have ability to do the job [k] lower cost/time of training [an]
    May not be willing to listen to ideas of owner/other employees [k] which could demotivate other employees [an] Other factors could include:
    Personality/leadership style [k] as a manager must be able to lead/ work with subordinates [an]
    Qualifications/skills [k] show that the person has the technical ability to do the job [an]
    Requirements of the job [k] because if it’s a new role, there might not be anyone with the necessary experience to do it anyway [an] Other appropriate responses should also be credited. 6 This is a general question so there are no marks for application. Some points could be awarded for different options, but do not award the same point twice. For evaluation to be awarded justification will usually follow on from relevant analysis of points Notes Justification might include: Experienced managers are likely to make fewer mistakes [k] reducing amount of waste [an]. Qualifications [k] are also necessary as it shows they have the relevant technical ability [an]. However, experience is likely to be the most important factor as it clearly shows the person has shown ability to do the job whereas qualifications only indicate they have the knowledge to do so and therefore may add value to the business more quickly. [eval] [eval] Notes
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