Chapter 23~Chain Of Production

Question 1

Wholesaler?

Answer 1

A Buisness that buys in bulk (breaking bulk) from the manufacturer and sells in smaller quantities to the retailer e.g Musgraves

Question 2

Retailer?

Answer 2

A person who buys goods and services from manufactures or wholesalers and sells them in small quantities to the consumer at a profit

Question 3

Franchise?

Answer 3

A franchise exists when the owner of a business gives permission to another person to set up a branch of their business in another location in return for a fee e.g subway, Costa

Question 4

Production?

Answer 4

Combining the four factors of production so that goods and services are made that the consumer wants

Question 5

3 types of industries?

Answer 5

• extractive industry
• construction&manufacturing industry
• service industry

Question 6

Extractive industry?

Answer 6

Businesses that take or extract raw materials from the land e.g forestry the sea e.g fishing the air e.g wind power

Question 7

Constructive&manufacturing industries ?

Answer 7

Construction: building of houses
Manufacturing: make finished products

Question 8

Service industry?

Answer 8

Provides a service e.g transport

Question 9

3 types of production ?

Answer 9

1) primary production: extractive industry e.g wood
2) secondary production: constructive&manufacturing
3) tertiary production: service industry

Question 10

Chain of production for a wooden table?

Answer 10

Forest/wood – carpenter – furniture shop

Question 11

3 Considerations when choosing a channel of distribution

Answer 11

• type of good, are they perishable?
• speed
• distance , imported or exported

Question 12

3 examples of channels of distribution

Answer 12

MANUFACTURER MANUFACTURER MANUFACTURER

CONSUMER                      RETAILER                   WHOLESALER  items bought in a               factory e.g Waterford      CONSUMER                    RETAILER glass factory shop          Furniture shop 
                                      Buys from furniture           CONSUMER
                                                 factory.                   Local shop buys 
                                                                                   from musgarves

Question 13

Why would the wholesaler be omitted from the channel of distribution?

Answer 13

• storage may not be required
• if it is important to get to the consumer quickly
• short shelf life

Question 14

Why would the wholesaler and retailer be omitted from the channel of distribution ?

Answer 14

• if the products were customised

* technology advances mean you can buy online and get it delivered

Question 15

3 functions of a wholesaler

Answer 15

• buy in large quantities from manufacturer
• sells in smaller quantities (breaking bulk)
• sells wide range of goods

Question 16

Independent retailer / unit shop?

Answer 16

Sole traders who operate small family shops often family owned e.g newsagents

Question 17

Multiple store?

Answer 17

Number of branches and sells one product e.g HMV

Question 18

Chain store?

Answer 18

Number of branches and sells different products e.g dunnes

Question 19

Supermarket?

Answer 19

Large self service retailer with a number of branches e.g supervalue

Question 20

Voluntary retail group?

Answer 20

Group of retailers who agree to buy their stock from on particular wholesaler only, prices are cheaper due to bulk buying, benifits from group advertising e.g spar

Question 21

Department store?

Answer 21

Large store selling different goods, divided into departments specialising in a particular product e.g brown Thomas, house of Fraser

Question 22

Discount stores?

Answer 22

Large quantity of one product sold a low prices e.g power city

Question 23

Mail order firms?

Answer 23

Retailers sell through post e.g little wood

Question 24

Shopping centres?

Answer 24

Big buildings in which there are a lot of small. Medium and large stores selling a wide variety of goods
Large amounts of parking
E.g dundrum

Question 25

4 functions of a retailer?

Answer 25

• Sells goods in small quantities to the consumer, breaking bulk
• sells wide range of good from different manufacturers
• may provide delivery service
• may offer online sales to customers

Question 26

Advantages and disadvantages of vending machines

Answer 26

Advantage:
•operates 24 hours a day

Disadvantage:
• may be vandalised

Question 27

2 Advantages of franchising?

Answer 27

• little risk attached to starting a business this way because the business is already successful in other locations
• the name is the business would be well known

Question 28

2 disadvantages of franchising?

Answer 28

• the new owner must pay money to the original owner each year which reduces the profits
• sometimes the owner cannot make major decisions without permission

Question 29

Channel of distribution?

Answer 29

The method used to get goods and services from the producer to the consumer