CTEC Business- Unit 1 Pre Release Jan 2025 Guide

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• Title: Cambridge Technical in Business Unit 1: The Business Environment

• Focus: Pre-release analysis for January 2025 exam.

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• Pre-release Research Brief:

  • Importance of independent research on specified themes.

  • Key Themes to Research:

    • Meeting objectives of external stakeholders.

    • Compliance with the Consumer Rights Act.

    • Practical application of SWOT analysis.

    • Operational responses to rising disposable income.

    • Usage of short-term sources of finance.

  • Purpose: The findings will serve as personal study notes; no materials are allowed during the exam.

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• Meeting Objectives of External Stakeholders:

  • Definition: Stakeholders have vested interests in a business's performance.

  • Types of External Stakeholders:

    • Customers: Seek quality, fair prices, ethical practices.

    • Suppliers: Desire reliable relationships and timely payments.

    • Local Communities: Expect job creation and CSR.

    • Governments: Focus on compliance and economic stability.

    • Pressure Groups: Advocate for sustainability and ethical practices.

  • Example:

    • Apple: Balances stakeholder objectives with product innovation and sustainability efforts.

    • Co-op emphasizes ethical practices and community engagement through fair trade and charity.

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• Importance of Meeting Stakeholder Needs:

  1. Positive Reputation:

     • Satisfying stakeholder needs leads to a favorable public image, attracting customers and investments.

     • Example: Patagonia's sustainability commitment enhances brand loyalty.

  2. Customer Satisfaction & Retention:

     • Meeting customer expectations ensures loyalty and repeat business.

     • Example: Amazon's robust customer service fosters long-term commitment.

  3. Attracting & Retaining Employees:

     • Companies with good stakeholder relations attract and retain top talent.

     • Example: Google's reputation for social responsibility and innovation appeals to job seekers.

  • Conclusion: Balancing stakeholder needs supports operational efficiency and growth.

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• Possible Exam Questions:

  • Identify external stakeholders for a business.

  • Explain how a specific business resolved a conflict with a trade union (e.g., Ponteland Golf Club and grounds workers).

  • Focus on meeting stakeholder needs or consequences of failing to meet their needs.

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• Understanding Stakeholder Interests:

  • Recognize the motivations of various stakeholders (e.g., suppliers want profits, customers desire quality).

  • Benefits of stakeholder engagement:

    • Positive publicity, better reputation, higher revenues.

    • Drawbacks include costs and time-consuming processes.

  • Example Question: Explain community objectives regarding litter management by a golf club; consequences of ignoring resident concerns.

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• Analysis Questions:

  • Requirement for specific references to a business and understanding outcomes (impact analysis).

  • Common errors in understanding drawbacks related to stakeholder engagement.

  • Factors influencing stakeholder conflicts and negative outcomes if ignored (bad publicity, legal actions).

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• Consumer Rights Act Compliance:

  • Protects consumers from unfair terms, regulates sales, and includes digital content provisions.

  • Key Features:

    • 30-day right to reject faulty goods.

    • One attempt for repair or replacement.

    • Goods should meet standards of satisfactory quality.

  • Material Specifics: Do not confuse consumer protection with safety regulations.

  • Advantages/Disadvantages:

    • Advantages: Improved customer trust, reduced legal risks.

    • Disadvantages: Higher operational costs, administrative burdens.

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• Example Businesses and their Compliance:

  • John Lewis: Offers extended warranties, exceeds legal requirements.

  • Amazon: Clear refund policies; streamlined returns enhance customer satisfaction at a cost.

  • Currys: Ensures compliance with clear refund strategies to protect reputation.

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• Exam Questions Regarding Compliance:

  • Explore how a researched business complies with the Consumer Rights Act.

  • Emphasis on provision and context for marking schemes.

  • Importance of specifying details to avoid losing marks.

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• SWOT Analysis in Action:

  • Businesses leverage strengths and address weaknesses for strategic positioning.

  • Internal Factors: Strengths and weaknesses focus on the business itself.

  • External Factors: Opportunities created by market conditions and threats from competition.

  • Example: Use in strategic planning and to assess competitive stance.

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• SWOT Analysis Case Studies:

  • Apple: Diversified using services and wearables to capitalize on intrinsic strengths.

  • Tesla: Expanded capacity and product lines using SWOT insights for strategic growth.

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• Operational Responses to Disposable Income:

  • Definition: Disposable income drives consumer spending on non-essential items.

  • Responses:

    • New product lines, premium pricing, targeted marketing, expansion of operations, upselling, innovation investment.

  • Recognition that luxury businesses benefit more from rising disposable income than budget brands.

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• Exam Practice on Responding to Disposable Income:

  • Consider responses like increased advertising or premium product launches.

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• Short-Term Sources of Finance:

  • Definition & Necessity: Working capital for daily operations, consists of credit cards, overdrafts, hire purchase, etc.

  • Benefits/Drawbacks overview for each financial source explored.

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• Exam Practice:

  • In-depth analysis of short-term finance methods, including benefits and limitations tied to operational context.

  • Understand financial impacts and appropriate usage of each financial source, considering both advantages and disadvantages.

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• Conclusion and Exam Preparation:

  • Emphasize understanding of course material, varied business research, and the necessity of contextual application in exam responses.

  • Aim for detailed answers that show analysis and impact.