Practise Edexcel Business questions on production, capacity, productivity and quality, applying operational data to explain resource-management decisions.
Source for use with Extract C
Belmont Estate
Belmont Estate is a plantation established on the Caribbean island of Grenada in the 17th century. Since 2017, its main activity has been chocolate manufacturing. The ‘tree-to-bar’ range of organic chocolate is produced from cocoa grown on the 1.6 km2 plantation. Natural flavours such as mango, banana and ginger are absorbed into the cocoa from crops growing close by, so that Belmont Estate can produce chocolate with unique flavours.
Batch production of the chocolate is used and is labour-intensive, from picking the cocoa to wrapping the chocolate bars. Despite the size of the plantation, the production process is well-organised, making it efficient. Belmont Estate prides itself on its reputation and the quality of chocolate produced, allowing it to sell at a price of $7.50 for a 55 g chocolate bar.
The owners of Belmont Estate offer a happy and positive place to work. The business aims to support the local community by providing employment and preserving the environment. These aims are well-received by visitors who enjoy tours of the plantation, as well as the increasing number of importers of Belmont Estate’s chocolate bars, most of whom are in the US.
Tours of Belmont Estate are run whenever there is a demand, whether from an individual visitor or a bus full of tourists. The price of a tour is $6.00. It is possible to book a tour through Belmont Estate’s own website or through Viatour, a tour business. However, if a tour is booked through Viatour, it charges 17% of the tour price as a fee for taking the booking.
Extract C
Belmont Estate
Belmont Estate is a plantation established on the Caribbean island of Grenada in the 17th century. Since 2017, its main activity has been chocolate manufacturing. The ‘tree-to-bar’ range of organic chocolate is produced from cocoa grown on the 1.6 km2 plantation. Natural flavours such as mango, banana and ginger are absorbed into the cocoa from crops growing close by, so that Belmont Estate can produce chocolate with unique flavours.
Batch production of the chocolate is used and is labour-intensive, from picking the cocoa to wrapping the chocolate bars. Despite the size of the plantation, the production process is well-organised, making it efficient. Belmont Estate prides itself on its reputation and the quality of chocolate produced, allowing it to sell at a price of $7.50 for a 55 g chocolate bar.
The owners of Belmont Estate offer a happy and positive place to work. The business aims to support the local community by providing employment and preserving the environment. These aims are well-received by visitors who enjoy tours of the plantation, as well as the increasing number of importers of Belmont Estate’s chocolate bars, most of whom are in the US.
Tours of Belmont Estate are run whenever there is a demand, whether from an individual visitor or a bus full of tourists. The price of a tour is $6.00. It is possible to book a tour through Belmont Estate’s own website or through Viatour, a tour business. However, if a tour is booked through Viatour, it charges 17% of the tour price as a fee for taking the booking.
Define the term 'batch production'. (Extract C, line 8)
Extract C
Belmont Estate
Belmont Estate is a plantation established on the Caribbean island of Grenada in the 17th century. Since 2017, its main activity has been chocolate manufacturing. The ‘tree-to-bar’ range of organic chocolate is produced from cocoa grown on the 1.6 km2 plantation. Natural flavours such as mango, banana and ginger are absorbed into the cocoa from crops growing close by, so that Belmont Estate can produce chocolate with unique flavours.
Batch production of the chocolate is used and is labour-intensive, from picking the cocoa to wrapping the chocolate bars. Despite the size of the plantation, the production process is well-organised, making it efficient. Belmont Estate prides itself on its reputation and the quality of chocolate produced, allowing it to sell at a price of $7.50 for a 55 g chocolate bar.
The owners of Belmont Estate offer a happy and positive place to work. The business aims to support the local community by providing employment and preserving the environment. These aims are well-received by visitors who enjoy tours of the plantation, as well as the increasing number of importers of Belmont Estate’s chocolate bars, most of whom are in the US.
Tours of Belmont Estate are run whenever there is a demand, whether from an individual visitor or a bus full of tourists. The price of a tour is $6.00. It is possible to book a tour through Belmont Estate’s own website or through Viatour, a tour business. However, if a tour is booked through Viatour, it charges 17% of the tour price as a fee for taking the booking.
Analyse two reasons why productivity may have improved at the Belmont Estate.
Assess the likely advantages of using labour-intensive production methods, rather than capital-intensive methods, for a business such as Belmont Estate.
Sources for use with Extract A Brooke Downs Vennard Partnership (BDVP) BDVP is a firm of solicitors located in British Columbia, Canada. Established in 1980, it has grown into one of the most respected legal businesses in the area. This is important because there are over 10,000 qualified solicitors competing for clients in British Columbia. As well as providing clients with assistance when buying property or making a will, the partners specialise in business, contract and commercial law. Clients are allowed either 30 or 60 days to pay on completion of legal work provided by the partnership. This has helped BDVP increase its client base. However, it can make cash flow more difficult to manage. Communication is very important to BDVP and the partners try to replace computers whenever they become out‑of‑date and slow. They also make sure employees are trained in the use of technology. As well as employing five solicitors, BDVP has a team of other employees in legal occupations such as secretaries, administrative assistants and junior associates. Employees currently work from 8.30 am – 5 pm with a 30 minute lunch‑break. All employees are encouraged to take responsibility for their work and are often consulted about changes affecting the office. The latest example of a consultation was a discussion about changes to employee protection legislation and how it would affect the partnership.
Extract B British Columbia Employment Standards Act British Columbia employers can expect significant amendments to the Employment Standards Act to be introduced in 2019. Some of the more significant recommendations for amendment include:
allow alternative working hours within the 40‑hour week to the standard eight‑hours per day
allow employees the right to refuse overtime in circumstances where overtime would conflict with significant family‑related commitments, scheduled educational commitments, or other employment obligations
the existing five days per year unpaid family responsibility leave would be replaced with seven days per year of unpaid leave, which could be taken for reasons of the employee’s own illness or for the care, health, or education of a child in the employee’s care.
Assess whether improving employee motivation is likely to be the most effective way to increase productivity for a business such as BDVP.
Sources for use with Extract C Hostelworld reports dip in revenue and operating profit Hostelworld is an Irish company that provides an online booking platform for cheap accommodation worldwide. It operates in a market that is described as being ‘highly competitive’ . In 2018, it reported a decrease in revenue and profit. However, this decrease is similar to many of its competitors and it is optimistic about its future due to favourable market conditions and overall growth in the market. Hostelworld said revenue fell by 5% to €82.1m and operating profit fell to €6.7m in 2018, down from €11.9m the previous year. Finance costs (interest payments) remained constant at €0.6m. However, Chief Executive, Gary Morrison said, “We have a well known brand that is trusted by loyal customers. Our objective is to return to growth in 2020” . Hostelworld enables travellers to make bookings on its website or its app. It reported a 22% increase in bookings from the app, which accounted for 40% of all bookings in 2018. This shows the introduction of the app was a worthwhile cost to the business. “To encourage customers to use Hostelworld we have to adapt to suit their busy lifestyles. Having an option of how to book offers customers convenience and flexibility,” continued Mr. Morrison. In 2018, Hostelworld said it was proposing to pay a dividend to shareholders of €0.138 per share and intends to use share capital to help fund its growth strategy. The strategy will take advantage of growth in the market and focus on increasing market share for Hostelworld. This will be through investment in advanced technology, increased awareness of customer needs, refocused marketing activities and a strengthened management team.
Extract D International tourist arrivals forecast to reach 1.8 billion by 2030 20 000 18 000 16 000 14 000 12 000 10 000 800 600 400 200 0 1950 International tourist arrivals received (million) 1960 1970 1980 1990 2000 2010 Forecast 2020 2030 Year Actual
Analyse two ways Hostelworld's efficiency might be affected by having an option of how to make a booking.
Source for use with Extract C
Belmont Estate
Belmont Estate is a plantation established on the Caribbean island of Grenada in the 17th century. Since 2017, its main activity has been chocolate manufacturing. The ‘tree-to-bar’ range of organic chocolate is produced from cocoa grown on the 1.6 km2 plantation. Natural flavours such as mango, banana and ginger are absorbed into the cocoa from crops growing close by, so that Belmont Estate can produce chocolate with unique flavours.
Batch production of the chocolate is used and is labour-intensive, from picking the cocoa to wrapping the chocolate bars. Despite the size of the plantation, the production process is well-organised, making it efficient. Belmont Estate prides itself on its reputation and the quality of chocolate produced, allowing it to sell at a price of $7.50 for a 55 g chocolate bar.
The owners of Belmont Estate offer a happy and positive place to work. The business aims to support the local community by providing employment and preserving the environment. These aims are well-received by visitors who enjoy tours of the plantation, as well as the increasing number of importers of Belmont Estate’s chocolate bars, most of whom are in the US.
Tours of Belmont Estate are run whenever there is a demand, whether from an individual visitor or a bus full of tourists. The price of a tour is $6.00. It is possible to book a tour through Belmont Estate’s own website or through Viatour, a tour business. However, if a tour is booked through Viatour, it charges 17% of the tour price as a fee for taking the booking.
Extract C
Belmont Estate
Belmont Estate is a plantation established on the Caribbean island of Grenada in the 17th century. Since 2017, its main activity has been chocolate manufacturing. The ‘tree-to-bar’ range of organic chocolate is produced from cocoa grown on the 1.6 km2 plantation. Natural flavours such as mango, banana and ginger are absorbed into the cocoa from crops growing close by, so that Belmont Estate can produce chocolate with unique flavours.
Batch production of the chocolate is used and is labour-intensive, from picking the cocoa to wrapping the chocolate bars. Despite the size of the plantation, the production process is well-organised, making it efficient. Belmont Estate prides itself on its reputation and the quality of chocolate produced, allowing it to sell at a price of $7.50 for a 55 g chocolate bar.
The owners of Belmont Estate offer a happy and positive place to work. The business aims to support the local community by providing employment and preserving the environment. These aims are well-received by visitors who enjoy tours of the plantation, as well as the increasing number of importers of Belmont Estate’s chocolate bars, most of whom are in the US.
Tours of Belmont Estate are run whenever there is a demand, whether from an individual visitor or a bus full of tourists. The price of a tour is $6.00. It is possible to book a tour through Belmont Estate’s own website or through Viatour, a tour business. However, if a tour is booked through Viatour, it charges 17% of the tour price as a fee for taking the booking.
Define the term 'batch production'. (Extract C, line 8)
Sources for use with
Extract A
Bee Hive Candles
US-based business, Bee Hive Candles (BHC) produces candles made from 100% pure beeswax. All candles are handmade using beeswax from US bees. Jennifer Wesolowski started the business in 2000, using personal savings. She decided to change from making candles as a hobby to setting it up as a business. A wide range of candles are offered but by using 100% beeswax, all candles are environmentally friendly. Unlike typical paraffin candles, they are biodegradable and produce no harmful toxins. They burn for longer, meaning better value for money. Although still a small business, BHC is growing. This is due to increasing consumer awareness of environmental issues and positive feedback on social media platforms. Jennifer remains dedicated to making quality candles and offering outstanding customer service. Newsletters are emailed to existing customers to advise of new products and offers. BHC charges $9.95 to send its candles to customers all over the US but at the moment does not accept orders from outside the US. Prices of the candles range from $6.95 to over $100 for a large pack of candles. The best-selling product is the pillar candle, priced at $17.95. It is popular because of its relatively low price and burns for approximately 50 hours.
Extract B
Candle sales in the US – some figures
• The US has the largest share of customers buying candles in the world.
• In the US 35% of all candles are sold online and this is increasing.
• Beeswax candles account for only 2% of all candle sales in the US market; this figure is increasing.
• Paraffin candles are currently the most popular type of candle, with nearly 40% of the market. This is followed by soy wax, palm wax and beeswax.
Assess the possible benefits for BHC of using labour-intensive production
methods.
Extract A
Arditi Tours
Arditi Tours is a bus company offering passengers travel between Pristina, in Kosovo, and Tirana, the capital of Albania. The 250 km journey takes about five hours, including a rest break and the formalities at the border crossing between Kosovo and Albania. The route is popular with students travelling to and from university, families who live across the border from one another and tourists. There are four buses every day, in both directions. The buses leave Pristina and Tirana at 05:00, 08:00, 11:00 and 15:00. A ticket for a one-way journey is €15. The price of the ticket includes two pieces of luggage weighing a maximum of 50 kg. Arditi Tours has a reputation for quality, reliability and clean buses. There are several competitors offering the same routes, at various times each day. Demand for travel varies considerably throughout the year, with services operating at full capacity some weeks but less than quarter capacity at others. The break-even point for Arditi Tours in April 2022 was 17 passengers per journey. The price of diesel that the buses use was €1.58 a litre in April 2022 but this price has been rising, leading to higher costs for Arditi Tours. April is a month of average demand for seats.
Extract B
Data showing the average number of passengers travelling per day on Arditi Tours services from Pristina to Tirana in April 2022
Extract B
Data showing the average number of passengers travelling per day on Arditi Tours services from Pristina to Tirana in April 2022
Using the data in Extract B, calculate to two decimal places the average daily
capacity utilisation of services from Pristina to Tirana for Arditi Tours in April 2022.
You are advised to show your working.
(4)
Capacity on bus services from Pristina to Tirana is frequently under-utilised.
Extract A
Arditi Tours
Arditi Tours is a bus company offering passengers travel between Pristina, in Kosovo, and Tirana, the capital of Albania. The 250 km journey takes about five hours, including a rest break and the formalities at the border crossing between Kosovo and Albania. The route is popular with students travelling to and from university, families who live across the border from one another and tourists. There are four buses every day, in both directions. The buses leave Pristina and Tirana at 05:00, 08:00, 11:00 and 15:00. A ticket for a one-way journey is €15. The price of the ticket includes two pieces of luggage weighing a maximum of 50 kg. Arditi Tours has a reputation for quality, reliability and clean buses. There are several competitors offering the same routes, at various times each day. Demand for travel varies considerably throughout the year, with services operating at full capacity some weeks but less than quarter capacity at others. The break-even point for Arditi Tours in April 2022 was 17 passengers per journey. The price of diesel that the buses use was €1.58 a litre in April 2022 but this price has been rising, leading to higher costs for Arditi Tours. April is a month of average demand for seats.
Extract B
Data showing the average number of passengers travelling per day on Arditi Tours services from Pristina to Tirana in April 2022
Analyse two possible reasons why Arditi Tours continues to offer four bus journeys
a day in each direction.
Extract B Kirklees Active Leisure (KAL) K A L is a UK-based charity focusing on the provision of leisure services. It was established by Kirklees Council in 2002. KAL operates 12 leisure centres, all of which include several health and fitness facilities. Some have tennis courts, some have football pitches and six have swimming pools. Off-peak membership costs £19.95 per month to use the facilities at less busy times and £29.95 per month at peak times, when demand is highest. It includes access to all health and leisure facilities, fitness classes and swimming pools. KAL has a high number of members so many of its peak time classes are full each week, leading to complaints from members. Following the global health crisis and changes in economic variables, such as increased energy costs, KAL has been under considerable financial pressure. At the end of 2022, it was decided that KAL's costs could only be reduced significantly by temporary reductions in the number of facilities operated. Two of the swimming pools and two of the leisure centres were closed completely during the winter of 2022/23. However, one of the pools closed was used by a number of local schools and re-opened in early 2023. Members were consulted on ideas to decrease costs and/or increase revenue. These included raising the monthly membership fee, reducing opening times of facilities, increasing the number of volunteers instead of paid employees and reducing the temperature of the swimming pools.
Extract C Selected information from KAL's statement of comprehensive income for the year ended 31 March 2022
Analyse two ways that KAL could reduce capacity utilisation at these classes.
Extract A
Anyone for cricket?
Tharindu Jayantha spends most days working for his parents at the family-owned grocery shop in Kandy, Sri Lanka. However, when there is an international cricket match in the country, the 24 year old packs a suitcase and becomes his own boss.
cricket supporters would pay for a souvenir T-shirt, I knew I should change what I was selling." In 2011, Sri Lanka hosted the Cricket World Cup and several matches were played at the Pallekele stadium near Kandy. This was followed in 2012 by another international cricket tournament, the World Twenty20. With the opportunity to put his ideas into practice so close to home, Tharindu was able to make enough profit to allow him to buy more T-shirts and travel to other stadiums in Sri Lanka whenever international cricket teams visited. "Although most of the time matches are only for one day, my expenses are just a sales pitch permit, transport and accommodation, totalling 5400 Sri Lankan rupees (LKR). I also pay 650LKR to buy each T-shirt but I have always been able to sell everything," Tharindu continued. It can be a problem to carry the T-shirts by myself on the train or bus, especially when there are delays and I have to change transport. I have considered paying someone to help me or even buying my own car but there is a lot of competition so I need to do some sales forecasting before making any decisions."
Extract A
Anyone for cricket?
Tharindu Jayantha spends most days working for his parents at the family-owned grocery shop in Kandy, Sri Lanka. However, when there is an international cricket match in the country, the 24 year old packs a suitcase and becomes his own boss.
cricket supporters would pay for a souvenir T-shirt, I knew I should change what I was selling." In 2011, Sri Lanka hosted the Cricket World Cup and several matches were played at the Pallekele stadium near Kandy. This was followed in 2012 by another international cricket tournament, the World Twenty20. With the opportunity to put his ideas into practice so close to home, Tharindu was able to make enough profit to allow him to buy more T-shirts and travel to other stadiums in Sri Lanka whenever international cricket teams visited. "Although most of the time matches are only for one day, my expenses are just a sales pitch permit, transport and accommodation, totalling 5400 Sri Lankan rupees (LKR). I also pay 650LKR to buy each T-shirt but I have always been able to sell everything," Tharindu continued. It can be a problem to carry the T-shirts by myself on the train or bus, especially when there are delays and I have to change transport. I have considered paying someone to help me or even buying my own car but there is a lot of competition so I need to do some sales forecasting before making any decisions."
Analyse two possible effects of poor inventory control for Tharindu.
Extract A
Lotus Garments Co.
Egyptian business Lotus Garments Co. is one of the leading clothing manufacturers in the world. It produces clothing for the biggest names in denim such as Levi Strauss & Co. and the Wrangler and Lee brands owned by the VF Corporation. Chairman and CEO Hossam Gabr, previously produced jackets and trousers but entered the denim business in 2002. Today 11,800 skilled employees at the Port Said factory can produce up to 26,000,000 items of clothing a year. Lotus Garments Co. has recently adopted both just in time (JIT) and total quality management (TQM) in order to keep up with international competition and give the flexibility to meet its customers' needs. The business meets all international standards for quality, production and health and safety. Although most pairs of jeans are exported to the USA, Lotus Garments Co. also supply clothing retailers in Egypt. It is planning to do two things. Firstly, to increase its sales in Egypt and secondly to reduce its annual total costs of $420m. By working closely with local suppliers Lotus Garments Co. believes it can continue to meet the needs of its customers for many years to come.
Extract B
Egyptian interest rates from 2010 to 2018
Analyse two possible problems for Lotus Garments Co. of using just in time (JIT).
Sources for use with
Extract C
Hot sauce is essential in Mexican cuisine
Hot sauce (or ‘salsa picante’ in Spanish) is an everyday ingredient in Mexican cooking. The people of Mexico have developed a strong liking for chilli peppers. In Mexican restaurants and homes no table is completely set without a bottle of hot sauce. Chilli peppers are mostly grown in Western Mexico. Each sauce tastes different, depending on the type of pepper used and the ratio of chillies to other ingredients such as vinegar and spices. Most households make their own versions but numerous businesses manufacture hot sauce brands for sale in Mexico and for export.
Extract D
Grupo Tamazula – our story
Grupo Tamazula is a public limited company that manufactures hot sauce in Guadalajara, in the Jalisco region of Mexico. The business began in 1960 when the Tamazula brand was introduced. It quickly became popular throughout Mexico. Shortly after, it introduced another brand of hot sauce, Salsa Valentina, to the market. Salsa Valentina became a market leader of hot sauce production with increasing sales across Mexico. Grupo Tamazula products are made with the finest ingredients. Salsa Valentina for example, is thicker than many of its competitors, and contains less vinegar and more fresh chillies. The hot sauces are packed using the most modern equipment available and investment in new technology keeps Grupo Tamazula up to date. The factory is over 26,000 m2, generating employment in the area. The company sells its products all over Mexico and through its US-based international sales office. Exports continue to increase, especially to the US and Canada.
Assess whether Grupo Tamazula will find it difficult to keep waste to a minimum.
Extract A
Arditi Tours
Arditi Tours is a bus company offering passengers travel between Pristina, in Kosovo, and Tirana, the capital of Albania. The 250 km journey takes about five hours, including a rest break and the formalities at the border crossing between Kosovo and Albania. The route is popular with students travelling to and from university, families who live across the border from one another and tourists. There are four buses every day, in both directions. The buses leave Pristina and Tirana at 05:00, 08:00, 11:00 and 15:00. A ticket for a one-way journey is €15. The price of the ticket includes two pieces of luggage weighing a maximum of 50 kg. Arditi Tours has a reputation for quality, reliability and clean buses. There are several competitors offering the same routes, at various times each day. Demand for travel varies considerably throughout the year, with services operating at full capacity some weeks but less than quarter capacity at others. The break-even point for Arditi Tours in April 2022 was 17 passengers per journey. The price of diesel that the buses use was €1.58 a litre in April 2022 but this price has been rising, leading to higher costs for Arditi Tours. April is a month of average demand for seats.
Extract B
Data showing the average number of passengers travelling per day on Arditi Tours services from Pristina to Tirana in April 2022
Extract A
Arditi Tours
Arditi Tours is a bus company offering passengers travel between Pristina, in Kosovo, and Tirana, the capital of Albania. The 250 km journey takes about five hours, including a rest break and the formalities at the border crossing between Kosovo and Albania. The route is popular with students travelling to and from university, families who live across the border from one another and tourists. There are four buses every day, in both directions. The buses leave Pristina and Tirana at 05:00, 08:00, 11:00 and 15:00. A ticket for a one-way journey is €15. The price of the ticket includes two pieces of luggage weighing a maximum of 50 kg. Arditi Tours has a reputation for quality, reliability and clean buses. There are several competitors offering the same routes, at various times each day. Demand for travel varies considerably throughout the year, with services operating at full capacity some weeks but less than quarter capacity at others. The break-even point for Arditi Tours in April 2022 was 17 passengers per journey. The price of diesel that the buses use was €1.58 a litre in April 2022 but this price has been rising, leading to higher costs for Arditi Tours. April is a month of average demand for seats.
Define the term 'quality'. (Extract A, line 10)
Extract A
Lotus Garments Co.
Egyptian business Lotus Garments Co. is one of the leading clothing manufacturers in the world. It produces clothing for the biggest names in denim such as Levi Strauss & Co. and the Wrangler and Lee brands owned by the VF Corporation. Chairman and CEO Hossam Gabr, previously produced jackets and trousers but entered the denim business in 2002. Today 11,800 skilled employees at the Port Said factory can produce up to 26,000,000 items of clothing a year. Lotus Garments Co. has recently adopted both just in time (JIT) and total quality management (TQM) in order to keep up with international competition and give the flexibility to meet its customers' needs. The business meets all international standards for quality, production and health and safety. Although most pairs of jeans are exported to the USA, Lotus Garments Co. also supply clothing retailers in Egypt. It is planning to do two things. Firstly, to increase its sales in Egypt and secondly to reduce its annual total costs of $420m. By working closely with local suppliers Lotus Garments Co. believes it can continue to meet the needs of its customers for many years to come.
Extract B
Egyptian interest rates from 2010 to 2018
Discuss the importance to Lotus Garments Co. of using total quality management
(TQM) to remain competitive.
Sources for use with Section B
Extract C
UK Government will consider additional 25p charge on disposable coffee cups
The UK Government is considering adding an additional charge of 25p on all disposable
coffee cups. This is aimed at helping the environment. Consumer trends have already
shown people are prepared to pay more in order to prevent billions of tonnes of waste
packaging ending up in the world’s oceans, such as with the success of the existing 5p
charge on plastic bags.
The proposal was announced by the UK Prime Minister as part of the government’s
25-year environmental plan. The focus is on the need to reduce the amount of plastic
thrown away each year.
The UK currently throws away approximately 2.5 billion disposable coffee cups every year
with only a small number being recycled. If government plans go ahead, it is estimated
the 25p charge could raise £438m and reduce use of the throw away cups by 30%.
Starbucks is to trial the additional charge, in London, but with a lower initial charge of
5p per cup. A spokesman for the coffee house chain from the US said its procedures
were focused on reducing environmental concerns at the same time as maintaining the
great taste, quality and service customers expect from Starbucks. Money raised will go to
environmental charities researching better ways to recycle and protect the environment.
Starbucks currently sells reusable cups for £1 and offers a small discount for people using
their own cup. It is the second biggest coffee house chain in the UK (after Costa Coffee)
and the average price of its coffee is around £2.50.
Extract D
Selected financial information from Starbucks’ consolidated income statement
12 months ending 31 October 2017
| $ | |
|---|---|
| Revenue | 22,386,800,000 |
| Direct costs | 9,038,200,000 |
| Interest | 92,700,000 |
| Taxes | 1,432,600,000 |
Analyse two possible reasons why quality management may be important to Starbucks.