GCSE

Business

J204/02: Business 2: operations, finance and influences on

business

General Certificate of Secondary Education

Mark Scheme for June 2024

Oxford Cambridge and RSA Examinations

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support, which keep pace with the changing needs of today’s society.

This mark scheme is published as an aid to teachers and students, to indicate the requirements
of the examination. It shows the basis on which marks were awarded by examiners. It does not
indicate the details of the discussions which took place at an examiners’ meeting before marking
commenced.

All examiners are instructed that alternative correct answers and unexpected approaches in
candidates’ scripts must be given marks that fairly reflect the relevant knowledge and skills
demonstrated.

Mark schemes should be read in conjunction with the published question papers and the report
on the examination.

© OCR 2024

Oxford Cambridge and RSA Examinations

J204/02 Mark Scheme June 2024

PREPARATION FOR MARKING

RM3

1. Make sure that you have accessed and completed the relevant training packages for on -screen marking.

2. Make sure that you have read and understood the mark scheme and the question paper for this unit.

3. Log-in to RM3 and mark the required number of practice responses (“scripts”) and the required number of standardisation responses.

YOU MUST MARK 6 PRACTICE AND 10 STANDARDISATION RESPONSES BEFORE YOU CAN BE APPROVED TO MARK LIVE
SCRIPTS.

MARKING INSTRUCTIONS

1. Mark strictly to the mark scheme.

2. Marks awarded must relate directly to the marking criteria.

3. The schedule of dates is very important. It is essential that you meet the 50% and 100% deadlines. If you experience problems, you must
contact your Team Leader (Supervisor) without delay.

4. If you are in any doubt about applying the mark scheme, consult your Team Leader by telephone or the RM3 messaging system, or by email.

5. Crossed Out Responses

Where a candidate has crossed out a response and provided a clear alternative then the crossed out response is not marked. Wh ere no
alternative response has been provided, examiners may give candidates the benefit of the doubt and mark the crossed out resp onse where
legible.

Multiple Choice Question Responses

When a multiple choice question has only a single, correct response and a candidate provides two responses (even if one of th ese responses
is correct), then no mark should be awarded (as it is not possible to determine which was the first response selected by the candidate).

Contradictory Responses
When a candidate provides contradictory responses, then no mark should be awarded, even if one of the answers is correct.

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J204/02 Mark Scheme June 2024

Short Answer Questions (requiring only a list by way of a response, usually worth only one mark per response)
Where candidates are required to provide a set number of short answer responses then only the set number of responses should be marked.
The response space should be marked from left to right on each line and then line by line until the required number of r esponses have been
considered. The remaining responses should not then be marked. Examiners will have to apply judgement as to whether a ‘second response’
on a line is a development of the ‘first response’, rather than a separate, discrete response. (The underlying assumption is that the candidate
is attempting to hedge their bets and therefore getting undue benefit rather than engaging with the question and giving the m ost relevant/correct
responses.)

Short Answer Questions (requiring a more developed response, worth two or more marks)
If the candidates are required to provide a description of, say, three items or factors and four items or factors are provide d, then mark on a
similar basis – that is downwards (as it is unlikely in this situation that a candidate will provide more than on e response in each section of the
response space.)

Longer Answer Questions (requiring a developed response)

Where candidates have provided two (or more) responses to a medium or high tariff question which only required a single (developed)
response and not crossed out the first response, then only the first response should be marked. Examiners will need to apply professional
judgement as to whether the second (or a subsequent) response is a ‘new start’ or simply a poorly expressed continuation of the first
response.

6. Award No Response (NR) if:

• there is nothing written in the answer space.

Award Zero ‘0’ if:

• anything is written in the answer space and is not worthy of credit (this includes text and symbols).

Team Leaders must confirm the correct use of the NR button with their markers before live marking commences and should check this when
reviewing scripts.

7. The RM Assessor comments box is used by your team leader to explain the marking of the practice responses. Please refer to these
comments when checking your practice responses. Do not use the comments box for any other reason.
If you have any questions or comments for your team leader, use the phone, the RM Assessor messaging system, or e-mail.

8. Assistant Examiners may send a brief report on the performance of candidates to your Team Leader (Supervisor) by the end of the marking
period.

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J204/02 Mark Scheme June 2024

9. Annotations

Annotation Meaning Annotation Meaning

Knowledge (AO1a)
Correct - 1 mark awarded K

Incorrect U Understanding (AO1b)

Benefit of doubt – mark awarded Application (AO2)

Not answered question – question is either
omitted or answer is not relevant to the question Analysis (AO3a)
asked
Too vague – no reward Evaluation (AO3b)

Repetition – credit already given or answer Not sure what the candidate is trying to say
repeats what is in the question or stem
Not used text – answer does not make use of Own figure rule
the context so no application mark

Noted but no credit given

Blank page (only use on Q18e)

Highlighting is also available to highlight any particular points on the script.

ARA – Any Reasonable Answer - Where ARA is indicated within the Guidance column for any item on this mark scheme, examiners must
accept any reasonable answer that in their professional opinion is as worthy of merit as those indicated on the final mark sc heme.
However, examiners should liaise with their Team Leaders/Principal Examiner wherever there remains any doubt as to whether or not
a response (or part-response) should be awarded.

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J204/02 Mark Scheme June 2024

Question Answer Marks Assessment Objective

SECTION A
1 A 1 1b
2 A 1 2Q
3 B 1 1b
4 B 1 2
5 C 1 1a
6 A 1 2Q
7 B 1 2 (PS)
8 D 1 2
9 B 1 1a
10 C 1 2Q
11 C 1 2
12 C 1 2
13 B 1 2Q
14 D 1 2Q
15 C 1 2Q

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

SECTION B
16 a Identify two characteristics of flow production. 2 One mark for each correct characteristic,
AO1a up to a maximum of two marks.
Answers may include:
• A business can make large quantities / in bulk
• Costs of production per unit are lower (economies of scale) Answers do not need to relate to Unilever
• Machinery / Automation
• Very expensive to initially set up No reward for comparative statements (with
• Undifferentiated items / products all the same / consistent regards to other production methods) unless they
quality / specialised contain a specific characteristic of flow production.
• Uses an assembly line
• Production is continuous / can run 24/7 No reward for the time it takes.
• Large stocks of components / raw materials may be necessary.

ARA
b Analyse one way the marketing function impacts on the 3 One mark for a way the marketing function
operations function of Unilever plc. AO1b may change.
AO2
AO3a
Understanding may include: No further marks can be gained without
• Advertising/promotion may take place understanding.
• Price changes
• New product development One further mark for application to
• Identifying new markets / market research Unilever.
• Using different selling methods – online & high street
One further mark for analysis of how
Application may include: marketing impacts on the operations
• Global markets; 190 countries function.
• Wide range of products
• International brands – including Lynx, Dove, Hellmann’s, Persil
NB: Analysis must be business-facing.
• Factories around the globe
• Flow and batch production used
• Average revenue has grown The understanding mark is awarded for a specific
• Economic climate is difficult, adapting to changes. aspect of the marketing function (no reward for

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

Analysis may include: general comments about ‘marketing changing’ or
• Changes in output / production / quantity produced. ‘going well’ or ‘being a global business’).
• Increase in production or production capacity.
• Find new ways to produce a product The analysis mark must be focused on a specific
• Need to invest in capital to increase / improve / enable impact on the operations function.
production.

Exemplar response
The marketing department may increase the amount of advertising (1)
for Lynx Body spray (APP). This means that operations will need to
increase production to meet the changes in demand (1).
ARA
c (i) Calculate Unilever plc’s average revenue from 2019 to 2022. 2 Two marks for correct answer (with or
AO2 without workings).
Indicative content:

51,900 + 50,700 + 52,400 + 60,000 = 215,000 (1) NB: Accept an answer of 53,750.

215,000m ÷ 4 No reward for any answer which correctly

calculates the average revenue for the wrong
€53,750m (1) period.

(ii) Explain one way revenue affects a business’ decision making. 2 One mark for identifying a way revenue
AO1b affects business decision making.
Answers may include:
• Price setting One further mark for explaining the way.
• Need to reduce costs
• Able to increase costs
• Ability to spend money on raw materials Answers do not need to relate to Unilever.
• Ability to continue to function
• Entering a new market / expansion No reward for a definition of revenue.
• Competing with others

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

• Decision to remove / continue with / develop new products (or
any other specific decision, e.g., to take more risky or less risky
decisions).

Exemplar response
It helps to decide how to price a product (1). If revenue is low, they
may consider increasing prices (1).

A business can look to expand (1) if it has lots of revenue (1).

ARA

d Explain how operating in a difficult economic climate might affect 2 One mark for identifying knowledge about a
a business. AO1a difficult economic climate.
AO1b
Answers may include: One further mark for explaining how a
• increased unemployment / fewer jobs business may be affected.
• reduced consumer incomes / less spending.
Answers do not need to relate to Unilever.
Exemplar response
There may be increased unemployment (1). If consumer incomes fall
the demand for products might fall (1).
There must be evidence of a poor economic
People may have less income (1) so demand may fall (1). climate issue before any impact on a business can
be rewarded.
ARA
Accept other examples of a poor economic climate
(e.g. high inflation, low/negative economic growth,
high interest rates, etc.)

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

e (i) State what is meant by international branding . 2 Two marks for a clear definition.
AO1a
Creating an image for a product (1) that is then communicated in One mark for a partial definition (e.g., a definition
countries all around the world (1). of branding or international marketing).

A recognisable brand (1) that is known worldwide (1). Answers do not need to relate to Unilever

Having a logo (1) which is recognised around the globe (1). No reward for a definition which is solely about
international trade or being a multinational.
Promoting your product all over the world (1).
ARA
(ii) Evaluate the benefits of international branding to Unilever plc. 7 Use marking grid to assess skill levels.
AO2
Application may include: AO3a Annotate as:
AO3b
• Multinational company; 190 countries Up to two marks for application to Unilever
• Products include Lynx, Dove, Hellmann’s, Ben & Jerry’s, Persil Up to two marks for analysis
• Sells a wide range of quality products Up to three marks for evaluation
• Factories around the globe
• Economic climate is difficult NB: Context must be used to be awarded as
• Worldwide revenue high and increasing since 2020. application.
Analysis may include: NB: Analysis must be business facing impact.
• Operating in many more countries may increase sales / profits.
• Develop a global brand that is recognisable in every country to For strong evaluation i.e., the full three marks, the
build customer loyalty or increase sales / profits. evaluation must be contextual.
• Allows development of a larger range of products
• The brand / reputation can provide a competitive advantage
• More businesses may be wanting to set up partnerships or joint No reward for answers about being a
ventures. multinational.
• Able to focus on countries where the economy is strong at that
time. No reward for disadvantages/drawbacks of
international branding, unless it is part of
evaluation.

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

Evaluation may include:
• The particular importance for a global business.
• The relative influence of different factors, e.g., despite strong
international brands, if consumer incomes reduce around the
world Unilever profit levels will go down and lead to cost cutting
such as redundancies.
• Having strong international brands is very important to the
growth of Unilever in terms of sales/profit but so is the range
and quality of products they provide.

Exemplar response
Unilever has a range of global brands that are familiar in the 190
countries (APP) they operate in. By having an international brand
Unilever can use the same advertising across the globe to increase
demand (AN).

By having a marketing campaign that runs around the globe for its
products like Ben and Jerry’s ice cream (APP), marketing costs can be
kept down (AN).

I think international branding does have many benefits for Unilever

(EVAL) because they are able to save on advertising costs through
economies of scale (EVAL) which increase the profit margins on those
branded products like Persil and Lynx (EVAL)
ARA

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J204/02 Mark Scheme June 2024

16 e(ii) Evaluate the benefits of international branding to Unilever plc.

Application Analysis Evaluation

(2 marks) (2 marks) (3 marks)
Strong 3 marks

A justified contextual judgement about the benefits to

Unilever of international branding.
2 marks 2 marks
[EVAL]
[EVAL]
Two uses of context in relation to Two different (business-facing) [EVAL]
the benefits of international benefits of international branding
branding
Good 2 marks
[AN]
[APP] [AN]
A justified judgement about the benefits of international
[APP]
branding.

[EVAL]

Limited 1 mark
1 mark
1 mark
One use of context in relation to
the benefits of international One (business-facing) benefit of
A decision about the importance of international branding.
branding international branding
[EVAL]
[APP] [AN]

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

17 a Identify one reason, other than expansion, why a business 1 One mark for a correct reason.
needs finance. AO1a

Answers may include: Answers do not need to relate to The Sea View
• Cash flow (day-to-day operations, such as buying raw Hotel.
materials or paying staff)
• Establishing a new business
• Recruitment costs No reward for any answer linked to expansion or
• Develop new products growth (e.g. buying a new hotel).
• Develop marketing activities
• Pay back any previous debt
• To prevent it going bankrupt / help it survive.

ARA
b (i) Explain why profit is important to a business’ future. 2 One mark for identifying why profit is
AO1a important, plus one further mark for
Answers may include: AO1b understanding.
• To see if the business has improved on last year (1) by using
profitability ratios (1)
• To compare performance against competitors (1) by using Answers do not need to relate to The Sea View
profitability ratios (1) Hotel.
• No need to seek out other finance (1) which could be
expensive (1) Understanding may come from how or why the
• To pay dividends (1) which keep shareholders happy (1) profit allows the benefit or an explanation/example
• To help to repay a loan / debt (1) so that costs fall (1) of the benefit itself.
• Buy new equipment and buildings (1) to replace worn out
items (1) No reward for a definition of profit.
• To help expansion (1) by opening new stores (1)
• Attract new investors (1) so that the business can expand (1) No reward for answers about allowing the
business to survive.
• Develop new products (1) to allow more profit to be made in
the future (1).

ARA

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

(ii) Calculate the daily break-even quantity for the proposed hotel. 3 Three marks for correct answer (with or
AO2 without workings).
SP- VC = Contribution
100 – 40 = 60 (1) No reward for the formula

FC/7 days One mark for contribution calculation

6300/7 = 900 (1) One mark for fixed cost calculation
One mark for correct answer of 15 rooms
Daily break-even = 900/60 = 15 (1) [OFR]
A total of two marks for not dividing the weekly
Alternative method fixed costs by 7. (e.g., 6300/60 = 105) (2).
Contribution = 60 (1)
Annual break-even = 6300/60 = 105 (1) NB: Maximum of two marks for an answer with the
Daily break-even = 105/7 = 15 (1) [OFR] wrong units (e.g. £).

(iii) Analyse one disadvantage to the partnership if the proposed 3 One mark for a disadvantage of having
hotel’s fixed costs were 10% higher than expected. AO1b costs that may be higher than expected.
AO2
AO3a
Understanding may include: No further marks can be gained without
• Could lead to lower profits (or a loss) understanding.
• Could lead to price increases
• Less money available for other needs (e.g. day-to-day One further mark for application to the
running of the hotel) Sea View Hotel partnership.
• Increases (harder to reach) the break-even level of output
(less able to cover the costs). One further mark for an analysis of the
disadvantage to a business of higher costs.
Application may include:
• Fixed costs of £6300 a week
• Increase of £630 a week / to £6930 / £90 more per day NB: Analysis must be business-facing.
• Variable costs of £40 a day
• Selling price is £100 per room No reward for ‘costs will increase’.
• £0.5m for redecoration of new hotel No application marks for context about the current
• £1.5m for purchase of new hotel hotel (e.g. it is a profitable hotel).
• 25 rooms in new hotel

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

• Break-even is currently 15 per day (105 per week) [OFR from
Q17bii]
• Break-even will increase to 17 per day (119 per week) No reward for answers which suggest an
• Existing bank loan. implication on the stress levels of the owners.

Analysis may include:

• Need to fill more rooms to cover the extra costs.
• May reduce customer demand (if price has increased)
• Decisions on new equipment or expansion may need to be
postponed.
• Share of the profits could be reduced for the owners.
• May put off investors/new partner into the partnership.
• May not be able to keep up with the competition.
• May lead to business debts or a need for more finance.

Exemplar response
If the fixed costs increased to £6930 (APP) the hotel makes less
profit (1). This may make it difficult to attract new investors (1).

ARA

c Identify two uses of a cash flow forecast to a business. 2 One mark for each correct use of a cash
AO1a flow forecast, up to a maximum of two
Answers may include: marks.
• A planning tool (e.g. estimating inflows or outflows)
• Anticipate periods of cash shortages (negative cash flow)
• Enable remedies to be put in place No reward for answers about profit, loss, break-
• Help with budgeting even, costs, spending money, etc.
• Identify or arrange an overdraft / funding
• Provide targets.

ARA

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

d (i) Analyse one advantage to the partnership of taking on Finley as 3 One mark for an advantage of taking on a partner.
a new partner to fund the proposed hotel. AO1b
AO2 No further marks can be gained without
AO3a
Understanding may include: understanding.
• New skills introduced
• A long-term source of finance One further mark for application to Sea View
• Injection of finance / no cost to raise finance. Hotel.

Application may include: One further mark for analysis of the

• Currently a profitable hotel advantage to a business of taking on a
• £2m cost of expansion partner.
• Already have a loan
• Concerns about the cost of borrowing increasing NB: Analysis must be business-facing.
• Considering getting a bank loan
• Friend of Anika
• Has been travelling around the world
• Photographer / Environmental campaigner.

Analysis may include:

• Will support cash flow therefore reduction in risk.
• Frees up other money they may have to spend on current
hotel.
• May not need to borrow money from the bank.
• The new hotel development can get started sooner.
• Lenders may be willing to lend as now more partners.
• Impact on reputation / success of business.

Exemplar response
Taking on a new partner would be a cost-free option (1) to raise £2m
(APP) for the development. Not needing to pay interest on this
finance saves them money which can now be spent on the hotel (1).

ARA

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

(ii) Analyse one disadvantage to the partnership of taking on 3 One mark for a disadvantage of taking on a
Finley as a new partner to fund the proposed hotel. AO1b partner.
AO2
AO3a
Understanding may include: No further marks can be gained without
• Decision making longer understanding.
• Loss of control for the current partnership
• May not have the skills needed to help partnership One further mark for application to Sea View
• Will need to split income/profit three ways Hotel.
• May not have enough money for the investment.
One further mark for analysis of the
Application may include: disadvantage to a business of taking on a
• Currently profitable new partner.
• £2m cost of expansion
• Already have a loan
NB: Analysis must be business-facing.
• Can afford another loan if costs do not increase
• Friend of Anika
• Has been travelling around the world
• Currently unemployed; photographer; environmental
campaigner.

Analysis may include:

• Decision making longer which may mean delays / arguments
as to how the hotel should look and operate
• May cause conflict as Finley is a friend of Anika
• May lead to less profit/success as his skills are not relevant
• May need to raise money from other sources if Finley does
not have £2m to invest?

Exemplar response
It may mean that it takes longer to make decisions (1) especially as
Finley may not have the skills needed as he is a photographer
(APP). This could delay the development of the hotel. (1)
ARA

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

(iii) Recommend whether the partnership should take on Finley as a 3 One mark for a clear judgement whether
new partner or use a bank loan to fund the proposed hotel. AO3b they should take on a new partner or use a
bank loan.
A full answer needs a supported judgement as to which option is
MORE APPROPRIATE. Plus
Two further marks for a contextual justification of
Justification can be made using any combination of features/ whether the business should take on
advantages/disadvantages so long as a comparison is being made Finley or use a bank loan.
(i.e. a link between them as opposed to separate points). Double tick
or
Exemplar responses
I think that Anika and Charlie should take out a bank loan (1). This One further mark for a non-contextual justification
will get them the £2m they need to develop the new hotel straight of whether the business should take on
away (CONT) which may be preferable to taking on a partner who Finley or use a bank loan.
may not have enough money on his own (+2). Single tick
NB: Context, rather than application, required for
The bank loan is a better option (1) as this will mean that the current full marks.
owners will not have to dilute their ownership of the business
whereas if they take on Finley, they will need to let him have a share NB Justification is why one method is BETTER
of the profits (+1). [A comparison answer but no use of context.] THAN the other for the business (rather than just
good for business). A comparison is required;
I recommend they take on Finley as a new partner (1). It could help therefore, the response must cover both
them gain interest free finance and bring in new ideas to the methods to gain a mark for justification. i.e. one
business. Finley has just returned from travelling the world so would method compared with rejected option (even if
have useful experience. [No comparison with taking out a bank loan so 1 the comparative justification for the rejected option
mark is the maximum which can be awarded.] is basic e.g. ‘cannot do …’ or ‘does not allow …’).

NB: If two separate points are made i.e. one

ARA about Finley and one about a bank loan, there
must be a comparative link i.e. both about risk
(accept riskier than), both about cost (accept
cheaper than), etc.

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

18 a Identify one factor which can affect the quality of a business’ 1 One mark for a correct factor.
products. AO1a

Answers may include: Answers may consider what will help improve
• Quality of supplies / raw materials used quality or make it less good.
• Employees experience / skill / motivation / training
• Production method used No reward for a definition of quality (e.g., fit for
• Use of technology purpose).
• Use of quality control methods
• Legislation. No reward for assuming that ‘low cost’ means low
quality.
ARA
b Analyse one impact of consumer law on Primark Ltd 3 One mark for understanding of consumer law.
AO1b
Understanding may include: AO2 No further marks can be gained without
AO3a
• Satisfactory quality / fit for purpose / as described understanding.
• Products meet the standard set
• Aims to protect consumers One further mark for application to
• Need to comply with the law (or an example of a specific Primark.
piece of consumer law).
One further mark for analysis of an impact
Application may include: on a business of consumer law.
• A fashion retailer
• Sells clothing and homeware
• Low-cost suppliers No reward for issues that are ethical rather than a
legal requirement.
• Prices lower than most retailers
• Selling online
• Clothes made using material from sustainable sources.

Analysis may include:

• Higher costs: finance needed
• Need to implement quality assurance or use better raw
materials

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

• Helps to improve the quality of goods / products will be of a
good standard
• Potential for returns which leads to loss of time and reduce
profit
• Not making products fit for purpose can negatively affect
reputation / sales / profits
• Financial impact (fines) of not complying with the law.

Exemplar response
If Primark Ltd sells some of its clothing and homeware products
(APP) which are ‘not as described’ (1) it could get lots of returned
goods. (1)

ARA
c Analyse one benefit for Primark Ltd of having low-cost 3 One mark for a benefit of having low-cost
suppliers. AO1b suppliers.
AO2
AO3a
Understanding may include: No further marks can be gained without
• Can pay less for raw materials (variable costs) understanding.
• Help to keep prices low
• Allows a business to buy in bulk One further mark for application to
• Will reduce break-even level of output Primark.
• More money available for other parts of the business.
One further mark for analysis of the benefit
Application may include: of having low-cost suppliers for a business.
• Range of products, including clothing and homeware
• Prices lower than most retailers
• Selling online NB: Analysis must be business-facing.
• Click and collect service
• Aware of need for ethical suppliers No reward for only stating ‘low costs’ or ‘costs will
• Clothes made using material from sustainable sources. be lower’.
Analysis may include:
• To increase sales

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

• Help maintain market share
• Help to compete with other firms
• Can maintain / increase profit margins (profitability)

Exemplar response
Primark can keep prices low (1). As it aims to have prices lower than
other retailers (APP) this will help to increase its market share (1).
ARA
d (i) Analyse one advantage and one disadvantage to Primark Ltd of 6 Advantage
offering an online click and collect service for shoppers. AO1b One mark for an advantage of offering an
AO2 online click and collect service.
AO3a
Application may include:
• A fashion retailer No further marks can be gained without
• Lower prices than most other retailers understanding.
• Low-cost suppliers
• Changes in buying habits One further mark for application to
• Only started selling online in 2022 Primark.
• Pressure from customers for online buying
• Ethical factors are important One further mark for analysis of the given
advantage for a business.
• Clothing and homeware.

Advantages of offering click and collect service

NB: Analysis must be business-facing.
Understanding may include:
• Sell to more people / products
• Open 24/7 for orders
• Professional website adds to brand image NB: The advantage must be for Primark Ltd (and
• Save money on delivery to customers’ homes. not other stakeholders, such as customers).
Analysis may include:
• Primark is ‘coming into line’ with competitors hence this No reward for a basic answer of ‘make more
should boost revenue. profit’ – it needs to be linked with higher revenue
• Increase or maintain market share / competitiveness. or competitiveness.

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J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

• More online presence leading to more awareness of the Disadvantage
brand by customers. One mark for a disadvantage of offering
an online click and collect service.
Disadvantages of offering click and collect service.
Understanding may include: No further marks can be gained without
• Increased costs (e.g., for staffing or website management) understanding.
• Increased levels of returns / refunds
• Reduced chance of impulse purchases One further mark for application to
• More competition online Primark.
• Keeping customer data safe online
• Keeping up with advances in technology / possible failures in One further mark for analysis of the given
technology disadvantage for a business.
• Still need to arrange a collection service – no delivery to
customer.
NB: Analysis must be business-facing.
Analysis may include:
• Competitors can see what Primark are doing more easily and
NB: The disadvantage must be for Primark Ltd
compete better against them
(and not other stakeholders, such as customers).
• May lead to lower sales / profits / productivity
• May be fined / bad publicity if data is not kept safely
• Primark still need expensive stores on the high street
• May affect spending in other areas of the business. No reward for ‘customers may not want (or be
able) to buy online’ – they can still go to the retail
Exemplar response store.
One advantage is that more people can access the website 24/7 (1)
which is what customers want due to changes in buying habits
(APP). This may lead to an increase in market share (1).

One disadvantage is that they have only started selling online in

2022 (APP) so would need new staff to handle the orders which
would increase costs (1) and may lead to a reduction in profit
margins (1).

ARA

21
J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

(ii) Recommend whether Primark Ltd should continue to offer an 3 One mark for a judgement whether Primark
online click and collect service for shoppers. AO3b should or not continue to offer a click and
collect service.
A full answer needs a supported judgement based on the context.
Plus
Justification can be made using any combination of features/ Two further marks for a contextual justification of
advantages/disadvantages so long as the decision is supported. whether Primark should or not
continue to offer a click and collect
Exemplar responses service.
Primark should continue to offer a click and collect service in their Double tick
stores (1). If it stops then it may lose customers who have got used or
to ordering online, as people have changed the way they buy
(CONT). (+2) One further mark for a non-contextual justification
of whether Primark should or not continue
Primark should continue to offer a click and collect service in their to offer a click and collect service.
stores (1). If it stops then it may lose customers who have got used Single tick
to ordering online. (+1)

ARA NB: Context, rather than application, required for

full marks.

To justify any decision, candidates need to do

more than consider points which are a repetition
or extension of advantages/disadvantages of
providing a click and collect service.

22
J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

e Evaluate whether Primark Ltd’s use of ethical suppliers comes 9 Use marking grid to assess skill levels.
* into conflict with its shareholders’ objectives. AO1a
AO1b Annotate as:
AO2
Knowledge may include: AO3a One mark for knowledge of ethics
• Ethics focuses on doing what is right or wrong. AO3b One mark for understanding of ethics
Up to two marks for synoptic application*
Understanding may include:
• Pay suppliers a fair and appropriate amount Up to two marks for analysis
• Using fair trade suppliers Up to three marks for evaluation
• Treat their workers well (no reward for legal requirements)
• Using sustainable resources. *Application refers to synoptic application only.

Application may include:

Reference to the context of a shareholder objective.
• Profits / profitability No reward for general stakeholder objectives.
• Growth of the business
• Reputation of the business No reward for environmental considerations.
• Share price/value (market capitalisation)
• Dividends. ------------------------------------
Knowledge – what is ethics?
Analysis may include (and may occur simultaneously with
application): Understanding – an example of ethical behaviour
• Higher costs will lead to lower profits or why it is followed.
• Decreased profits mean less dividends for shareholders
• May increase the price of the clothes for customers which Application – examples of shareholder objectives
they do not like, and Primark could lose share value. (not application to Primark).

Evaluation may include: Analysis – how the use of ethical suppliers will
• Primark’s ethical supply chain will/will not come into conflict affect (positive or negative) a shareholder
with the owners’ objectives objective.
• Other factors may be more important
• Other things may conflict with the shareholder’s objectives Evaluation – the decision must be explicit for 1
like providing a good service mark. For two marks there must be a valid
• Consideration of short-term costs verses long-term benefits justification. For strong evaluation i.e., the full

23
J204/02 Mark Scheme June 2024

Question Answer Marks Guidance

• A judgement about why a particular shareholder objective is three marks, the evaluation must be contextual to
most affected. Primark.

Exemplar response
Being ethical is doing what is right and wrong (K). This can be
choosing a supplier who is fair trade (U).

Shareholders will want Primark to make a profit (APP) but ethical

suppliers may charge more, increasing costs and reducing profits
(AN).

They may also want Primark to grow (APP). This growth might be
slower if they choose suppliers who cost more and reduce the profit
available for growth (AN).

Primark’s ethical supply chain will come into conflict with shareholder
objectives (EVAL). Any increase in costs may force prices up so that
customers go to competitors who are now relatively less expensive
(EVAL). As Primark’s key focus is low prices (CONT) it could affect
profits, so dividends paid to its shareholders may fall. (EVAL)

ARA

24
J204/02 Mark Scheme June 2024

18e* Evaluate whether Primark Ltd’s use of ethical suppliers comes into conflict with its shareholders’ objectives.

Knowledge Understanding Application Analysis Evaluation

(1 mark) (1 mark) (2 marks) (2 marks) (3 marks)
Strong 3 marks

A justified contextual judgement about

whether ethical objectives come into conflict
2 marks with shareholder objective(s).
2 marks [EVAL]
Two (business-facing) pieces of
analysis which show how two [EVAL]
Two examples of
different shareholder objectives [EVAL]
shareholder
are affected by the use of ethical
objectives
Good suppliers. 2 marks
1 mark 1 mark
[APP]
Knowledge of Understanding [AN] A justified judgement about whether ethical
[APP] [AN]
ethics of ethics objectives come into conflict with shareholder
objective(s).
[K] [U]
[EVAL]

Limited 1 mark
1 mark
1 mark
One (business-facing) piece of
One example of a
analysis which shows how a A decision about whether there is conflict
shareholder
shareholder objective is affected between ethics and shareholder objective(s).
objective. by the use of ethical suppliers.
[EVAL]
[APP]
[AN]

25
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