CHRIST JUNIOR COLLEGE

International Baccalaureate Diploma Programme

Year: 2020

Date: Subject: Business Management Level: Standard /Higher Level

Assessment Instrument: Written (Formative Assessment I)

Name of the student: Reg. No.:

Time: 1 Hour 15 Minutes Max. Marks: 40

Instructions to Candidates:

a. Do not open this examination paper until to do so.

b. A clean copy of case study (Gabriel Gaga) to be used.
c. Read the case study carefully.
d. Maximum marks for this examination paper (40 marks).
e.Section A: answer one question.
f. Section B: compulsory question.
g.Section C: compulsory question.
 Section A
Answer one question from this section

1. (a) Define the following terms:

(i) Sole trader (line 5) (2 marks)

(ii) Non-profit organizations and Non-government organizations (2 marks)

(b) Evaluate the usefulness of SWOT to a business such as Gaga Management

Limited. (4 marks)

(c) Prepare SWOT Analysis framework for Gaga Management Limited, based
on your assessment of internal and external elements that influence its
success. (6 marks)

2. (a) (i) Define focus group (line 96) (2 marks)

(ii) Distinguish entrepreneur and Intrapreneur (line 54) (2 marks)

(b) Using the case study given, analyse issues that Mr Carroccio faced when he
had to start up his restaurant in Bordeaux. (4 marks)

(c) Using information from the case study, the strategic options given by Kersey
& Joyce (K&J), applying suitable business tools, Prepare Ansoff’s matrix of
the various options given by K & J and make a supported recommendation to
Gaga on which to select. (6 marks)

Section B

Answer the compulsory questions from this section.

(iii) (a) Discuss two advantages and disadvantages to Gaga Management

Limited if it exercises the option to become a public limited company (line
81) (4 marks)
(iv) (b)Define Charities (line113) (2 marks)
 Section C
I. Answer the compulsory question from this section.

Mr. Sheikh Dawood having nearly 20 years of achievements in fuelling the next-level
operations in FMCG & Healthcare with multi-cultural and global experience in
Business/Marketing Planning, Product & Market Analysis was successful in driving
business revenue and profit gains as well as improving on organizational productivity
and performance. Enterprising leader with a track record of contribution in planning,
development and execution of regional business plan at Coca-Cola Bottling Co., Muscat
that helped streamline operations, heighten productivity and enhance internal controls.
Worked his prime career in Coca-Cola Bottling Co. (Al Ahlia - Gulf Line LLC), Muscat
as Market Planning Manager, Market Analyst & Data Analyst for 13 plus years. In 2013
moved back to India for good. He hoped to use his talents and use his work experience
in setting up his own business trying with different options. After attending a business
conference, he had been interested in the franchising exhibition there. One of the
businesses offering to sell franchises was “Wash Buddy Laundromats Pvt. Ltd.” with its
mission statement “To be one stop, affordable, accessible laundry solution provider with
the fastest turnaround time”. Having a vision statement “To be pioneer in revolutionizing
the way India does laundry”. It has13 branches in Bengaluru in different locations. Mr.
Sheikh was interested in service industry so as to operate in the tertiary unit to ensure
adequate returns on investments and greater focus on customer service. He understood
that the rising income associated with higher living standards leads to consumer
spending on laundry services.

After exploring various business options, he decided to take this business opportunity.
The only problem he faced was lack of business confidence. He met one of his friend
who acted as his consultant and was supported him in this venture. His firm “The
Wardrobe Salon” had a smooth kick-start with four employees in providing quality
services to upper middle class customers at affordable prices. His business USP was
discreet wash, using eco-friendly detergents, free pick-up and delivery services.
The aims & objectives of “The Wardrobe Salon”:

 Increase annual turnover from 24 lakhs to 40 lakhs in three years

 To spread new branches in next 24 months
 To lower cost of operating, so as to provide best affordable prices with quality
assurance to customers
 To achieve 20% average annual growth in sales turnover, profits and earning.
 To create awareness among customers and community the concept of charity to
help the needy keeping in his stores a charity box “save for self and save for
others”

In the first year, after a few months the business had break-even. But had perennial
problems in labour management, since most of them were though skilled but lacked
organization belonginess despite Mr.Sheikh’s and his consultant’s thorough timely
interventions, motivating the employees. There was high attrition for four to five months.
Then things got stabilized in labour management, but the operating costs were
increasing due to change in fuel, power expenses, had to incur huge advertisement
costs (though the franchisor was not doing much to promote their brand). He was not
able to increase the prices as there was huge competition. In the meanwhile, he
expanded his business with the same business segment a new branch was acquired
“The Laundry matters” in order to compensate the losses in “The Wardrobe Salon”. The
acquisition was done on an arbitrary basis with a quick valuation. The deal was settled
and takeover happened. After a few months, Mr. Sheikh noticed that though this new
acquisition had a good potential market specially the target customers were college
students, PG residents who avail quick laundry services, the equipment’s which he
acquired were obsolete, faced in this unit too labour issues. Though the sales revenue
was giving him a fair rate of returns.

a. Identify two reasons why Mr. Sheikh has chosen to operate in tertiary sector
(2 marks)
b. Analyse two strategic objectives that Mr. Sheikh’s business might try to achieve
(4 marks)
c. Evaluate SMART objectives of Mr. Sheikh’s franchising business.(6 marks)
d. Outline the factors of production needed to set up “The Wardrobe Salon”/ “The
Laundry matters” (4 marks)
e. Explain how two internal stakeholders and two external stakeholders groups can
benefit from rising sales and profits in Mr. Sheikh’s business. (4 marks)