The Purpose & Nature of Businesses (AQA GCSE Business)

HelloFresh is the world’s leading meal-kit delivery company. Each meal-kit contains all the ingredients and a recipe to cook a meal from scratch. HelloFresh delivers the kits to customers. The company was set up by two entrepreneurs in 2011 when they spotted a gap in the market to help busy people cook high quality meals at home. HelloFresh offers meal kits to suit the needs of young families and couples who are prepared to pay a premium for its service.

HelloFresh are proud to be environmentally responsible and advertise that it is the ‘greener way to shop for groceries’. It uses recycled packaging and carefully plans delivery routes to make sure that vehicles travel the shortest possible distance. Meal-kits are becoming very popular in the UK and HelloFresh is operating in an increasingly competitive market. HelloFresh tries to keep its customers interested by developing exciting new recipes each week that are different to the ones that competitors are offering. This process is expensive and time consuming. HelloFresh is now looking for opportunities to reduce costs. It uses customer reviews to find out which foods customers like and dislike, but not all customers give regular feedback. Once HelloFresh has developed a new recipe, the Finance and Production departments must work together to make sure the ingredients are available within the budget.

Adventures currently employs eight staff in the UK, who are all keen sporting enthusiasts. Adventures’ employees are expected to sell holidays and take payments but also deal with all customer enquiries such as advice on local facilities.

Sales have fallen recently and staff absenteeism has increased. Other rival businesses have increased their salaries. As John is unable to offer a competitive salary, employees have been asking for extra benefits. Discounts on holidays, commission or profit sharing are being used by different competitors.

John is drawing up a business plan to expand into ski holidays in the Italian resort of Folgaria. The business plan outlines the objectives of the business. Within three years, John aims to double profits and would like to have a 30% market share of ski holidays to Folgaria. To achieve this, the business would need to sell on average 2000 ski holidays each winter. Adventures will increase its number of employees to 10 to sell ski holidays, so the company is moving to a new office with more space. The new employees enjoy skiing; one of them will live in the ski resort for the winter and support customers when on holiday.

Eve is a sole trader. She owns and runs Style the Chic (STC). STC is a fast fashion website aimed at females aged 16–24. Eve started the business five years ago. She invested her £5000 life savings. The business made a profit of £450 000 last year.

Fast fashion means producing cheap clothes as quickly and as frequently as possible. STC works with reality TV celebrities that have a large social media following. The celebrities help design and promote a collection (range of clothing items).

STC has 30 employees. However, Eve makes all the major decisions in the business. She decides which products to order from suppliers and the selling prices. The buying team works with suppliers. Recently staff turnover in the buying team has increased.

Table 1 – Information on STC

TradeUp is a high street retailer that buys, sells and exchanges second-hand entertainment products and technology. These products include video games, mobile phones and tablet computers. TradeUp was established in 2002. One of its franchisees is Amelia Appleby

The demand for some second-hand products, such as mobile phones, changes quickly. Amelia needs to make sure that her prices are competitive with those of other second-hand retailers; otherwise, she will lose customers.

Table 1 Extract of Income Statement for year ending April 2020

Amelia has always liked her location in a busy town centre and has never had any direct competition. This location has provided Amelia with loyal customers who like the convenience of being able to visit her store when they are in town shopping. However, another retailer located nearby has announced that it will start to offer a similar service to TradeUp. Amelia has heard that a unit on an out-of-town retail park has become available. She has found out that although the size of the unit at the retail park is bigger than her current location, the rent would be £825 per month, which is lower than her current payment of £1100 per month. There is a bus link every hour to the retail park and lots of free parking; however, not all her current employees can drive.

HelloFresh is the world’s leading meal-kit delivery company. Each meal-kit contains all the ingredients and a recipe to cook a meal from scratch. HelloFresh delivers the kits to customers. The company was set up by two entrepreneurs in 2011 when they spotted a gap in the market to help busy people cook high quality meals at home. HelloFresh offers meal-kits to suit the needs of young families and couples who are prepared to pay a premium for its service.

HelloFresh is proud to be environmentally responsible and advertise that it is the ‘greener way to shop for groceries’. It uses recycled packaging and carefully plans delivery routes to make sure that vehicles travel the shortest possible distance. Meal-kits are becoming very popular in the UK and HelloFresh is operating in an increasingly competitive market. HelloFresh tries to keep its customers interested by developing exciting new recipes each week that are different from the ones that competitors are offering. This process is expensive and time consuming. HelloFresh is now looking for opportunities to reduce costs.

It uses customer reviews to find out which foods customers like and dislike, but not all customers give regular feedback. Once HelloFresh has developed a new recipe, the Finance and Production departments must work together to make sure the ingredients are available within the budget.

Swim to Success (STS) is a programme that teaches young children how to swim through weekly lessons. It was developed by Jade Jackson, an ex-Olympic swimmer. Jade employs swimming instructors who deliver the programme using the pool facilities at gyms across the North East of England.

Information:

Jade set STS up as a sole trader because she wanted to make the key business decisions herself. Initially Jade used a bank loan as her main source of finance and secured the loan against her home which she owns. Jade would like to expand STS. However, she is struggling to raise the finance herself as her costs are still high. To help her manage financially, Jade has arranged an overdraft on her business bank account. She relies on this to pay employees if the business does not have enough cash at the end of the month. Jade has recently received a letter from the bank explaining that interest rates on bank loans and overdrafts are going to increase.