P2 - Ethics

Question 1

Benefits for being an ethical producer

Answer 1

Good business image and reputation - more sales
Morally right
Motivate staff so they work harder as paid fairly
Good for the environment

Question 2

Reasons against being an ethical producer

Answer 2

Raises costs (as higher wages)
Many customers don’t truly care

Question 3

Examples of being ethical

Answer 3

Sustainable materials
Reduce waste
Reuse
Recycle
Pay fair wages
Environmentally friendly
Animal welfare
not employ child labour

Question 4

What is the definition of sustainability?

Answer 4

Meeting the needs of today without taking resources away from future generations

Question 5

Benefits to being sustainable

Answer 5

Good reputation
Better for the environment and the future
Can charge higher prices
Favourable to community
New customers

Question 6

Problems to being sustainable

Answer 6

More expensive production costs
More expensive to buy and produce
Sales, maybe Louis, if the business charges too high a price

Question 7

What has caused globalisation?

Answer 7

Transport
Telecommunications and the Internet
Improved technology

Question 8

What is a multinational company?

Answer 8

A company that operates in more than one country

Question 9

Advantages of being a multinational company

Answer 9

• Access to more workers in foreign countries
• Tax avoidance by locating in the lower tax countries, reducing costs
• Lower costs and cheaper labour
• Increasing sales as located in more countries

Question 10

Disadvantages of being a multinational company

Answer 10

• higher costs for the business of transporting goods globally

Question 11

Advantages for a country hosting a multinational company

Answer 11

• taxes and jobs provided
• Lower prices for customers as the multinational company would bring new competition for local businesses

Question 12

Disadvantages for a country hosting a multinational company

Answer 12

Business closures as they are unable to compete with the larger multinational company

Question 13

Advantages of locating abroad

Answer 13

• Cheaper labour
• lower technology costs
• Lower property and land costs
• If there’s a higher demand there

Question 14

Disadvantages of locating abroad

Answer 14

• businesses may find that unskilled workers in new countries provide a lower quality product
• Transport costs
• Communication difficulties e.g different languages

Question 15

What is international Branding

Answer 15

International branding is about creating a name for a business by establishing and building a brand identity within global markets

Question 16

Benefits of international branding

Answer 16

• higher trust as people tend to trust a large multinational company more so more sales
• Can use international social media - social media can be used for a very low cost to run a campaign that stretches across multiple countries

Question 17

Disadvantages of international branding

Answer 17

Higher competition as in more countries

Question 18

Benefits of providing good quality

Answer 18

• additional sales
• improved reputation
• repeat customers
• competitive advantage
• able to increase prices

Question 19

Problems of providing poor quality

Answer 19

• refunds
• recalls
• reputation issues
• demotivated staff
• lower sales

Question 20

Benefits of globalisation to a Uk business

Answer 20

• easier sell products abroad
• locate cheaper raw materials or components
• access to cheaper labour

Question 21

Globalisation issues for a Uk business

Answer 21

• increased foreign competition