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Outline two differences between a co-operative and a limited company - Leaving Cert Business - Question A - 2007
Question A
Outline two differences between a co-operative and a limited company. Co-operative: - Democratically run – one person – one vote - Run by an elected management comm... show full transcript
Worked Solution & Example Answer:Outline two differences between a co-operative and a limited company - Leaving Cert Business - Question A - 2007
Step 1
Outline two differences between a co-operative and a limited company.
Answer
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Democratic Structure: A co-operative operates on a democratic basis where each member has one vote, irrespective of their investment in the business. In contrast, a limited company typically operates on shareholding where voting rights are proportional to the number of shares held by each member.
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Management: In a co-operative, the management is run by an elected committee chosen by the members, which ensures that the interests of the members are prioritized. By contrast, a limited company is governed by a Board of Directors, who may not necessarily represent the interests of all shareholders.
Step 2
Apart from batch production, name two other types of production used in business.
Answer
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Job Production: This method involves producing custom items in small quantities tailored to specific customer requirements.
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Mass Production: In this system, products are manufactured in large volumes using assembly line techniques.
Step 3
Outline three features of batch production.
Answer
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Production Quantity: In batch production, a certain amount or quantity of a product is produced at one time before switching to a different product or batch.
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Skilled/Semi-skilled Workers: This method often requires skilled or semi-skilled workers who are able to handle the specific tasks associated with each batch.
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Flexible Machinery: Batch production typically uses a lot of flexible machines or automation, such as ovens that can be adjusted for different product types.
Step 4
Identify four factors that Milltown Bakery Co-operative should consider when deciding the price of its products.
Answer
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Cost of Production: Understanding the total cost, including materials, labor, and overhead, is crucial for setting a profitable price.
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Competition: Analyzing what competitors charge for similar products can help in positioning the price effectively.
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Demand for Product: Assessing customer demand can provide insights into price elasticity and potential profit margins.
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Pricing Strategies: Utilizing different pricing strategies, like penetration pricing or skimming pricing, can influence sales and market standing.
Step 5
Describe three reasons why Milltown Bakery Co-operative would consider expanding the business.
Answer
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Economies of Scale: Expanding the business could lead to lower costs per unit due to increased production levels, which enhances profit margins.
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Reduce/eliminate Competition: By expanding, the co-operative might be able to capture a larger market share, reducing the number of competitors.
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Increase Demand: A larger operation could offer greater variety or improve product availability, thus attracting more customers.
Step 6
Outline three advantages to Milltown Bakery Co-operative of having a brand name.
Answer
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Helps Identify the Product: A strong brand name allows customers to easily recognize the products, fostering brand loyalty.
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Creates Customer Loyalty: A reputable brand instills trust, encouraging repeat business from satisfied customers.
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Allows New Products to be Launched: A well-established brand can simplify the introduction of new products, as customers are more likely to try new offerings from a brand they trust.