Title 4. Case 4.pdf ✅

AATIK TASNEEM | O/A-LEVEL | BUSINESS & ECONOMICS | +92 304 1122845 1 P2 - Case 4 | O/N 2023, V2 (Case 1)
AATIK TASNEEM | O/A-LEVEL | BUSINESS & ECONOMICS | +92 304 1122845 2 (a) (i) Induction training (a) (ii) These cost can be directly related to the production or activity of a business and vary directly with the level of output. These can be clearly identified with a particular activity and can be allocated to a cost center. (3) Example: A gold mine would need to pay the miners + pay for the rent for machines for extracting the gold. (b) (i) Profit = Total Revenue - Total Cost 0.9 = 3.4 - TC | TC = 2.5 (Cost in 2020) 0.2 = 2.8 - TC | TC = 2.6 (Cost in 2022) Change in cost = 2.6 - 2.5 = 0.1 (Increased) (b) (ii) (1) One way to measure the size of GT to check the number of workers employed. (2) As GT has different types of workers ranging from people who guide visitors and some younger workers who are part of the customer service representatives. (3) As in 2020 GT had 54 employees but this decreased by 7 workers in 2022 showing the employees to be only 47 helps to understand that the size of the business is shrinking. (c) 8 MARKS Def > Secondary Data > Use for data that is already collected. Past company records > use past sales + tourist data on theme park, restaurant and gift shop > understand the reason behind past success + see how the sales declined from 3.4m to 2.8m > helps to redesign the marketing mix > improve sales by solving problems like add features to make it more fund + reduce prices to adjust customer needs > boost profit from 0.2 > ensure growth [HOWEVER] new business so might not have a lot of data on the theme park > difficult to fully understand the reason behind the failure > sampling errors can result in more fabrication > wrong marketing mix > revenue can drop even more than 0.2m > fall in profit > new business won't be able to survive. Newspapers and magazines > helps to stay updated with current political condition > understand why customers think prices are high > helps to position themselves better > focus only on those elements that customer like out of the 5 they currently offer + close the others > save running + promotion expense > boost profits > reinvest to launch new activities [HOWEVER] only give general economic overview, data is not specific to GT > won't help to solve internal problems like quality of the tour + experience being boring > wrong decisions > drop in sales > can't invest in good labor > even increase the problem of customer satisfaction > increasing failure.
AATIK TASNEEM | O/A-LEVEL | BUSINESS & ECONOMICS | +92 304 1122845 3 (d) 12 MARKS (Q) Evaluate the importance to the ongoing success of GT of developing intrapreneurship. [12] Def > Intrapreneurship > Workers come up with innovative ideas using enterprise to increase the profitability of a business. [ADV 1] > Solve internal problems like drop in visitors > staff gets motivated > helps to stop labor turnover which increased in 2022 (54 to 47) > maintain these workers improve quality of service > motivated guides and consumer representative = improved tour experience > solve problems like park is not fun > improved experience > positive word of mouth > more visitors > grow and gain economies of scale > reduce the ticket prices still stay profitable > sustain sales > reinvest to maintain the labor. [EVAL] Depends on the skills of the young workers + tour staff > less likely to work on part-time young workers + more effective on tour guides since they have past experience in the mines. [DIS 1] > Unskilled employees waste time > young workers + tour guides might not have relevant experience to solve problems of few visitors > just allowing workers would delay the decision > wastage of time creates an opportunity cost of output > reduces efficiency > high cost and with sales falling by 17% difficult to maintain profits which have already fallen by 78% > difficult to solve problems as less money available to upgrade the park to make it more fund and offer discounts to promote visitors. [EVAL] Depends on the effectiveness of GT's training in the past two years. Since the brand is new was Kayo an effective leader to create a system where workers come up with innovative ideas, as this is not something GT can achieve in the short-run specially with part-time employees. FINAL EVAL (1) Overall GT should encourage it because the workers are the biggest asset in an experience based business > without motivated workers they cannot resolve their current problems of high ticket price + park not being fun. (2) However it depends on why the problem emerged in the first place. Primary and secondary data is required to fully understand the reason. If it was not a good experience because the tour guides were not social and energetic then intrapreneurship works best. (3) but if it is due to the product and the area not being up to the mark then investing in the theme park makes more sense. (4) To conclude developing intrapreneurs is a long-term solution to the problem and would play a part as the park expands. If Kayo wants more instant results they have to reduce prices and boost promotion highlighting the parks USP of providing underground mine tours.