A293 Production Finance and the External

A293 Production Finance and the
External Business Environment
Your final exam Summer 2011
 To
be able to list the 4 areas of study
for the A293 exam in June 2011
 To be able to identify the format of
the exam
 To be able to discuss the answers to
some tough business questions
What’s this Unit all about?
Compulsory (means you have to do it)
90 minute paper (over in a flash)
Short answers (great)
Based on a case study
You get the case study 8 weeks before the
exam (Early April)
4 areas of study
Using and managing
Financial information and
decision making
Business issues and influences
The wider business world
1. Using and managing resources
(Resources are things that you use in business e.g. people, premises
and raw materials)
Methods of production (Wedding cakes are not made mass
production, can you think of other things that might be a
“one off”?)
How business can add value (take some leather and turn it
into shoes or belts etc. Can you think of other examples? )
Quality of products (e.g. you see a t-shirt in a shop that has a
hole in it, would you buy the t-shirt and what do you now
think of the shop?)
How businesses cost production (If you make one tray of
cakes to sell it costs you £10, how much would it cost to
produce £10,000 cakes?)
How businesses can get benefits from getting larger (If you
buy animal feed in bulk do you think it would be cheaper or
more expensive than buying small quantities?)
2. Financial information and decision
(or thinking about how to make and spend money)
How to raise finance (e.g.You could go to a bank for a
loan because you want to expand but what are your
other options?)
Cash flow forecasting (you need money to buy stock
and pay bills, can you keep track of your money go
Profitability (It’s Ok being in business BUT is it making
any money? If it is how much of that money is profit?
Could you improve how profitable you are? How
would you do this?)
3. Business issues and influences
(or all the other stuff outside of your business that might
affect your profit)
Environment issues (e.g.You own a factory that is very noisy, you
want to expand in a built up area, what kind of problems might you
Ethical issues (e.g. you buy and sell coffee from farmers in Africa
but you like to make a large profit so you don’t pay them the going
rate. You are the only buyer in the region, is this unfair or is it just
Market structures (e.g. You are one of only 3 companies who
produce a flibberdyjibbert for the UK market. Would you have a
secret meeting with the other two company managers to fixe the
price so you make a nice fat profit?)
Business cycle (It is a recession – again – do you think producers of
everyday goods or luxury goods are going to suffer most, and
4. The wider world
(or All the stuff that affects business over which they have
no control)
Government and its influence on demand (e.g the
rate of VAT charged will have an impact on your
profit. What is the current rate of VAT ? And
what do they spend your tax on?)
 Globalisation (e.g. Companies trading worldwide,
name three global brands)
 Exchange rates (all about import and export of
goods and changing currency, have you been on
holiday and had to convert money? Great, where
di you go and can you do this again in the exam?)
 The EU (how many member states does it have
and what influence do you think it has on
Examiner tips
Its important to know all the theory stuff
Its ace to know all the calcs and how to do them
A few keywords to show your level of
understanding would be just peachy
Always put conclusions / summaries in your
answers (so practice that)
Learn to choose an option but say why not the
other (I like butter because it tastes so creamy,
however marg spreads straight from the fridge
and has a buttery taste.)
Learn to see the pros and cons in everything