2025 AQA AS Business 7131/1 Paper 1 MERGED QUESTION PAPER & MARKSCHEME

2025 AQA AS Business 7131/1 Paper 1 MERGED QUESTION PAPER & MARKSCHEME whats the product life cycle describes the different stages a product goes through over time; r&d, introduction, growth maturity, and decline whats the boston matrix it positions products in relation to how fast the market is growing and the market share of the product compared with the largest competitor; dogs (l-l), ? (h-g, l-s), cash cows (h-s, l-g), and stars (h-h) whats the value of branding to a business? new products are likely to be accepted if they are associated with a strong brand but a negative event/publicity can tarnish an organisations brand or reputation the value of product portfolio analysis allows a business to review its product range to determine whether its balanced and where investment is required but to be effective it has to carry out regular product portfolio analysis the value of the product life cycle allows business to identify stage each product is in within the portfolio and aids decision-making but the exact life span of a product is difficult to predict the value of new product development allows business to develop a product with USP that will stand out from rivals but many products that make it to the market dont sell as well as expected and therefore get withdrawn a benefit and a drawback of multi-channel distribution increased flexibility and choice for customers to purchase goods which drives sales but can be expensive to develop and time consuming to manage a benefit and draw of digital marketing greater insights into market and customers available but negative feedback/publicity from customers can be seen by others and scruntinised benefits and drawbacks of e-commerce increased access to markets both nationally and internationally but is expensive and time consuming to develop efficient shopping experience value of budget device it provides criteria for evaluation of performance and it serves as a control Contribution per unit formula Selling price - variable costs per unit gross profit formula Revenue - cost of sales Total contribution formula total SR - Total VC 3 ways of reducing break-even output costs, and lowering variable costs per unit increasing selling price per unit, lowering fixed Gross profit margin formula Gross profit / revenue x 100 profit from operations formula operating profit margin formula profit for year formula gross profit - operating expenses Operating profit / revenue x 100 Operating profit + other profit - net finance costs - tax profit for year margin formula Profit for the year / revenue x 100 return on investment formula profit/investment x 100 Sources of finance capital debt factoring, overdrafts, retained profits, share capital, loans and venture benefit and drawback to overdraft business from existing owners doesn't need to be repaid but has dilution of control of the benefit and drawback to loans repayments over specific time period can help with financial planning but interest is added on to repayments benefit and drawback to debt factoring theres instant availability of cash but customers may be reluctant to use the firm if they find out the firms using a debt factoring firm Ways to improve cash flow Encourage customers to pay with cash, Encourage customers to pay straight away, Get a credit period with suppliers and sell extra stock. ways to increase profitability reducing costs, increasing turnover, increasing productivity, and increasing efficiency ways to increase profits change the price or increase sales volume Difficulties improving cash flow Seasonal demand, Overtrading, Over investment in long term assets, Unforeseen changes, Losses or low profits difficulties of improving profits customer perception depends on PED - price may impact negatively on difficulties of improving profitability customers may react negatively to an increase in price which may reduce demand 3 economies of scale technical, managerial and purchasing 3 diseconomies of scale control/co-ordination, communication and motivation economies of scope when its cheaper to produce a range of products rather than specialise in just a few products organic growth external growth takeover overtrading occurs when a business grows through expanding its operations when a firm grows by integrating with another firm due to a merger or expanding a business rapidly without gathering all of the necessary finance grieners model of growth identifies five crises that a business may experience as it grows through six different phases, 1) creativity - leadership, 2) direction - autonomy, 3) delegation - control, 4) coordination - rad tape, 5) collaboration - growth, (6 - alliances) a benefit and drawback of takeovers and mergers lower unit costs through benefit of economies of scale but if the businesses fail to take into account the different cultures they may not be compatible benefit and drawback to organic growth less risk attached as finance is usually retained profits but growth may be viewed as too slow to satisfy shareholder needs benefit and drawback for ventures access to greater resources (e.g. specialist staff) but partners may have different objectives for the joint ventures benefit and drawback of franchising ability for franchisor to expand without bearing the risk but brand name can be tarnished by franchises that don't follow rules Conglomerate integration Merger with or takeover of a business in a different industry Backwards vertical integration production process joining with a firm operating at an earlier stage in the Forwards vertical integration Involves a firm joining one in the next stage of production hortizontal integration companies producing similar products merge identify 4 ways to innovative kaizen, r&d, intrapreneurship, benchmarking product innovation process innovation service. development and introduction of new products The creation of a new way of making, or delivering a particular good or patent an official document granting ownership Copyright legal protection against copying work for artists, authors or composes 2 reasons why a business may feel pressure to innovate changes competitor actions and social the value of innovation to a business allows a business to remain competitive by providing factors such as better quality or lower costs but considerable risk is attached to innovation Handy's 4 classes of culture Power, Role, Task, Person Hofstede's national cultures - Individualism v collectivism