Practise organisation forms by recognising how each business operates and linking franchise or social enterprise choices to case evidence.
IKEA is a well-known home furniture retailer with stores throughout the world. It was started in 1943 by Ingvar Kamprad when he was given some money by his father for doing well at school. He wanted to produce furniture at a price that people could afford to buy.
He realised that transporting furniture to customers was difficult as goods were often damaged. He developed flat packs to avoid damage. A flat pack contained all the materials needed to self-assemble a table, a chair or a bed.
All IKEA stores are run as franchises.
Analyse the benefits to IKEA of all its stores being franchises.
A02
- Franchises allow IKEA to sell its flat pack products of tables and wardrobes throughout the world
- All franchisees pay a percentage of their profit to IKEA for the use of its name and furniture
A03
- IKEA benefits because it has many retail stores selling furniture, creating wealth for the business
- This allows IKEA to gain revenue from every franchised store making it more successful
(6)
Level
Mark
Descriptor
0
No Rewardable material.
Level 1
1-2
- Limited application of knowledge and understanding of business concepts and issues to the business context (AO2).
- Attempts to deconstruct business information and/or issues, finding limited connections between points (AO3).
Level 2
3-4
- Sound application of knowledge and understanding of business concepts and issues to the business context although there may be some inconsistencies (AO2).
- Deconstructs business information and/or issues, finding interconnected points with chains of reasoning, although there may be some logical inconsistencies (AO3).
Level 3
5-6
- Detailed application of knowledge and understanding of business concepts and issues to the business context throughout (AO2).
- Deconstructs business information and/or issues, finding detailed interconnected points with logical chains of reasoning (AO3).