Essay 1
‘The business world is becoming increasingly global. As a result of this, many companies, such as Costa Coffee and Dyson, have changed their strategies in relation to the markets they target or where they produce. Does the increasingly global nature of business mean that all organisations need to change their strategies significantly to achieve higher profits? Justify your answer with reference to costa coffee, Dyson and/or other organisations that you know.’ (40 marks)
The main aim of every business is to maximise profit. Profit is the total revenue the business receives minus their total costs and there are many ways businesses can increase this figure. One way of increasing profit is by increasing their revenue, this can be achieved by products or services being well marketed so they appeal to the businesses target audience. By doing this it will increase the interest that the targeted consumers have on the product or service and so demand will increase, meaning that consumers are more willing and able to pay for the good or service and so therefore will increase revenue. Another way of increasing profit is by reducing costs. Changing to a cheaper supplier, hiring cheaper employees, and changing the business premises to a cheaper place are all ways of reducing costs, both fixed and variable, and so would reduce total costs therefore increasing profit. Strategies, the medium to long term plans through which an organisation aims to attain its objectives, are put in place in order to help a business be successful, for example maximising profits.
Strategies may have to be changed to achieve higher profits due to the increasingly global nature of business, meaning that businesses are expanding into other countries and penetrating their markets.
Costa coffee is one business that is trying to find success by becoming global, becoming global is needed in order for costa to compete against their biggest competition in the market, Starbucks.
Starbucks entered China in
The main aim of every business is to maximise profit. Profit is the total revenue the business receives minus their total costs and there are many ways businesses can increase this figure. One way of increasing profit is by increasing their revenue, this can be achieved by products or services being well marketed so they appeal to the businesses target audience. By doing this it will increase the interest that the targeted consumers have on the product or service and so demand will increase, meaning that consumers are more willing and able to pay for the good or service and so therefore will increase revenue. Another way of increasing profit is by reducing costs. Changing to a cheaper supplier, hiring cheaper employees, and changing the business premises to a cheaper place are all ways of reducing costs, both fixed and variable, and so would reduce total costs therefore increasing profit. Strategies, the medium to long term plans through which an organisation aims to attain its objectives, are put in place in order to help a business be successful, for example maximising profits.
Strategies may have to be changed to achieve higher profits due to the increasingly global nature of business, meaning that businesses are expanding into other countries and penetrating their markets.
Costa coffee is one business that is trying to find success by becoming global, becoming global is needed in order for costa to compete against their biggest competition in the market, Starbucks.
Starbucks entered China in