Photo AI
6.1 Name TWO options available to an entrepreneur to distribute his/her products - NSC Consumer Studies - Question 6 - 2018 - Paper 1
Question 6
6.1 Name TWO options available to an entrepreneur to distribute his/her products. 6.2 Define the term target market. 6.3 Read the scenario below and answer the que... show full transcript
Worked Solution & Example Answer:6.1 Name TWO options available to an entrepreneur to distribute his/her products - NSC Consumer Studies - Question 6 - 2018 - Paper 1
Step 1
State the main purpose of stock control in Nelsia's business.
Answer
The main purpose of stock control in Nelsia's business is to ensure that she always has enough raw materials to meet production demands. This helps prevent production stoppages, ensures the right quantity of materials is ordered, and limits excess inventory that could lead to wastage.
Step 2
Explain why a tidy workplace is important for the efficient production of Nelsia's products.
Answer
A tidy workplace is crucial for efficient production for several reasons:
- Safety: Prevents accidents or injuries, ensuring a safe environment for all employees.
- Efficiency: Allows staff to find tools and materials more quickly, enhancing workflow and reducing downtime.
- Quality Control: Keeps the workspace organized, ensuring all items needed for production are accounted for, thus maintaining product quality.
- Professional Image: Creates a positive impression on customers and stakeholders, reflecting professionalism in operations.
Step 3
Step 4
Discuss why it is important for Nelsia to deal with customer queries.
Answer
Dealing with customer queries is vital for Nelsia for several reasons:
- Customer Satisfaction: Quickly addressing questions and concerns improves customer satisfaction and trust in her products.
- Feedback: Customer interactions can provide valuable feedback, allowing Nelsia to adapt her products and improve quality based on specific needs.
- Sales Growth: Satisfied customers are more likely to recommend her products, potentially increasing sales through word-of-mouth.
- Problem Resolution: Effective handling of complaints or issues can prevent loss of sales and help create loyal customers.
Step 5
Discuss how EACH of the following factors contributes to Nelsia's success: Availability of financial resources.
Answer
The availability of financial resources contributes significantly to Nelsia's success. It allows her to:
- Invest in inventory: Access to funds enables her to purchase high-quality materials and stock up on essential items.
- Expand operations: Financial backing supports her ability to grow her business, such as moving to a larger studio or opening more stalls.
- Marketing: Sufficient capital allows investment in marketing activities, increasing visibility and reaching a broader customer base.
Step 6
Discuss how EACH of the following factors contributes to Nelsia's success: Availability of raw materials.
Answer
The availability of raw materials is crucial for Nelsia's success:
- Continuous Production: A steady supply of materials ensures her production lines operate without interruption, maintaining consistency in product availability.
- Quality Assurance: Having access to quality raw materials positively impacts the overall quality of her jewellery, thereby enhancing customer satisfaction and reducing returns.
- Cost Management: Local sources for raw materials can help reduce costs and decrease shipping times, which is beneficial for maintaining profitability.
Step 7
Calculate how many pairs of earrings must be sold to cover the production cost. Show ALL your calculations.
Answer
To find how many pairs of earrings need to be sold to cover the production cost, we first calculate the total production cost:
- Raw materials cost: R7 970
- Overheads: R8 270
- Total production cost = Raw materials + Overheads = R7 970 + R8 270 = R16 240
Next, we divide the total production cost by the selling price per pair of earrings:
- Selling price per pair: R290
Number of pairs needed to cover costs = Total production cost / Selling price = R16 240 / R290 ≈ 56
Thus, Nelsia needs to sell approximately 56 pairs of earrings to cover her production costs.
Step 8
Calculate the profit that Nelsia will make if she sells 150 pairs of earrings. Show ALL your calculations.
Answer
To calculate the profit for selling 150 pairs of earrings:
-
Total Revenue from sales = Selling price per pair * Number of pairs sold = R290 * 150 = R43 500
-
Total Production Cost (calculated earlier) = R16 240
-
Profit = Total Revenue - Total Production Cost = R43 500 - R16 240 = R27 260
Therefore, Nelsia will make a profit of R27 260 if she sells 150 pairs of earrings.
Step 9
Give reasons for her success AND explain why she is likely to have continued success.
Answer
Nelsia's success can be attributed to several factors:
- Passion and Skill: Her dedication to learning and mastering her craft ensures high-quality products.
- Effective Branding: By developing a strong brand identity and utilizing social media, she has significantly increased her market reach.
- Responsive to Market Trends: Nelsia's ability to adapt her product offerings based on customer feedback and market demands fosters sustainable growth.
For continued success, she is likely to:
- Expand Product Range: Introducing new product lines could attract new customers and increase sales.
- Leverage Online Sales: As she continues to build her online presence, she can reach broader audiences beyond local markets.
- Maintain Customer Relations: By prioritizing customer support and maintaining quality, she can ensure loyalty, leading to repeat business.