GCSE
S24-C510U20-1A
C510U20-1A
WEDNESDAY, 5 JUNE 2025 – AFTERNOON
BUSINESS – Component 2
Business Considerations
Resource Material
C510U201A
01
© WJEC CBAC Ltd. LE/JS*(X23-C510U20-1A)
1. Taylors of Harrogate, is a tea and coffee
business established in 1886 in Yorkshire,
UK. A successful and major
brand of the business is
Yorkshire Tea.
, 2
Examiner
only
Yorkshire Tea is a traditional tea, the type that most tea drinkers in the UK drink. In the UK,
Yorkshire Tea has become one of the most popular tea brands and is exported to over 20
countries across the world.
Tea is big business in the UK:
• British people consume 100 million cups of tea per day, that’s 36 billion cups of tea per year.
• The UK population is the biggest consumer of traditional tea in Europe.
• New fruit and herbal infusion teas are becoming more popular with younger consumers.
• Tea drinkers in the UK are very loyal to their chosen brand.
Despite the popularity of tea in the UK, the traditional tea market is in long-term decline.
Figure 1 – UK sales volume in tonnes of traditional tea 2008 to 2020
Sales volume in tonnes
160 000
140 398
140 000 134 122 135 453 135 185 136 447
131 826
120 000
99 766 100 248 102 164
100 000 91 743
94 6 68 95 238 94 007
80 000
60 000
40 000
20 000
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year
Yorkshire Tea faces fierce competition from other leading brands such as Twinings, Tetley and
PG Tips. In addition, new brands such as Pukka have entered the market, selling a different
type of tea, including fruit, green and herbal teas, to meet the needs and wants of younger
consumers. These new types of tea are becoming very popular with consumers.
Yorkshire Tea has a reputation for high quality tea. The tea leaves used to make Yorkshire Tea
are grown in China, India, Sri Lanka and Kenya. The tea leaves are picked from the fields by
hand to preserve quality, damaged leaves are thrown away. The tea leaves are shipped
thousands of miles to reach the factory in Yorkshire to be blended to achieve the perfect
Yorkshire Tea taste. At its Yorkshire factory, a team of dedicated staff taste up to a thousand
teas a day to achieve the perfect blend, the tea is then packaged for storage. Tea is
distributed to wholesalers and supermarkets in the UK. Taylors of Harrogate also uses 36
different overseas distributors to manage sales across the world.
Yorkshire Tea uses batch production in its factory to produce the tea, it sells
the following range of tea bags in its product portfolio:
© WJEC CBAC Ltd. (C510U20-1) Turn over.
, 3
Examiner
only
• Consumers can choose to buy tea in different quantities, ranging from a box of 40 tea bags to
a bulk bag of 1040.
• Leaf tea (without the tea bag) for customers who prefer to use the traditional method of making
tea in a teapot and using a tea strainer.
• Different versions of Yorkshire Tea including Decaf, Hard Water, Gold, Breakfast.
• New speciality tea flavours include Bedtime, Toast and Jam and Biscuit.
Taylors of Harrogate aims to have a positive ethical impact when producing Yorkshire Tea.
It sees its suppliers as one of its most important stakeholders and is committed to strong,
long-term, ethical relationships.
The business has committed to the following standards when working with its global suppliers:
• Working conditions are safe
• No child labour is used
• Working hours are not excessive • Living wages are paid.
C510U201A
03
Turn over.
2. Bubbles Ltd is a UK based, nationwide supplier of hot tubs. The business was established in
2008 by Barry Wall. Barry started the business as a sole trader. He began by buying inflatable
hot tubs from manufacturers outside the UK such as China, then repackaging them with his
own logo and selling the hot tubs on third-party selling websites such as Amazon and eBay.
Barry started the business from his home storing the inflatable hot tubs in his garage.
The inflatable hot tubs are sent to customers with a
pump so customers can easily assemble them.
Barry had excellent feedback from customers about
the quality of the hot tubs, the clear instructions and
the after sales service. The price of the inflatable hot
tubs sold by Barry ranges between £300 and £500.
© WJEC CBAC Ltd. (C510U20-1) Turn over.
, 4
Examiner
only
Since Barry started the business there has been a big increase in demand for hot tubs.
Due to increasing sales, in 2015 Barry decided to expand the business. Barry was finding it
difficult to keep up with demand. There was also not enough space in the garage to store the
increased quantity of hot tubs. Barry decided to invest in a small warehouse and
distribution centre in an industrial park. In the same year, Barry decided to change the
ownership of the business into a private limited company to become Bubbles Ltd. Barry could
no longer do all the work himself and he employed four staff to help in the warehouse and
distribution centre. He also decided to set up his own e-commerce website for the business.
After continued growth in sales and profit, Barry is
now considering expanding Bubbles Ltd further by
selling more expensive plumbed-in hot tubs as well
as continuing to sell his popular range of inflatable
hot tubs.
If Barry decides to go ahead with the expansion of the
business, he will source the plumbed-in hot tubs from a
UK supplier. The plumbed-in hot tubs are very big and
expensive so he intends to store a limited number of
them in his warehouse and distribution centre. By not
having an expensive showroom where people can see the plumbed-in hot tubs Barry thinks
he will be able to sell the hot tubs at more competitive prices. However, he is concerned about
delays in delivery from the UK supplier to his warehouse and distribution centre resulting in a
long delivery time to the customer.
Barry will have to employ specialist staff to fit the plumbed-in hot tubs. He will also have to
invest in a large van.
Barry carried out primary and secondary market research to help him make a decision. Barry
spent an evening using the internet to carry out some research and found that:
• According to an article in 2019, the UK hot tub market is due to grow by 9.6% between 2021
and 2026.
• A rise in disposable income and awareness about health are factors that have led to growth in
the hot tub market in the USA.
• Rising energy bills could contribute to increased costs for hot tub owners.
• The average price to customers of purchasing a plumbed-in hot tub including installation is
£6000.
Barry also carried out primary market research by creating an online survey for his existing
customers. 50 customers responded and the results showed that:
• 20% of customers said they would consider purchasing a plumbed-in hot tub.
• Customers said they would be willing to pay between £4000 and £7000 for a plumbed-in hot
tub.
• 60% of customers said they would be put off from buying a plumbed-in hot tub if there were
long waiting times for delivery.
• 40% of customers said they would be reluctant to purchase an expensive product without first
seeing it in a showroom.
Selling more expensive hot tubs will be a large financial investment for Barry. He has
estimated the following costs:
• To employ two new members of skilled staff to deliver and fit the hot tubs will
cost £80 000 per year.
© WJEC CBAC Ltd. (C510U20-1) Turn over.
S24-C510U20-1A
C510U20-1A
WEDNESDAY, 5 JUNE 2025 – AFTERNOON
BUSINESS – Component 2
Business Considerations
Resource Material
C510U201A
01
© WJEC CBAC Ltd. LE/JS*(X23-C510U20-1A)
1. Taylors of Harrogate, is a tea and coffee
business established in 1886 in Yorkshire,
UK. A successful and major
brand of the business is
Yorkshire Tea.
, 2
Examiner
only
Yorkshire Tea is a traditional tea, the type that most tea drinkers in the UK drink. In the UK,
Yorkshire Tea has become one of the most popular tea brands and is exported to over 20
countries across the world.
Tea is big business in the UK:
• British people consume 100 million cups of tea per day, that’s 36 billion cups of tea per year.
• The UK population is the biggest consumer of traditional tea in Europe.
• New fruit and herbal infusion teas are becoming more popular with younger consumers.
• Tea drinkers in the UK are very loyal to their chosen brand.
Despite the popularity of tea in the UK, the traditional tea market is in long-term decline.
Figure 1 – UK sales volume in tonnes of traditional tea 2008 to 2020
Sales volume in tonnes
160 000
140 398
140 000 134 122 135 453 135 185 136 447
131 826
120 000
99 766 100 248 102 164
100 000 91 743
94 6 68 95 238 94 007
80 000
60 000
40 000
20 000
0
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Year
Yorkshire Tea faces fierce competition from other leading brands such as Twinings, Tetley and
PG Tips. In addition, new brands such as Pukka have entered the market, selling a different
type of tea, including fruit, green and herbal teas, to meet the needs and wants of younger
consumers. These new types of tea are becoming very popular with consumers.
Yorkshire Tea has a reputation for high quality tea. The tea leaves used to make Yorkshire Tea
are grown in China, India, Sri Lanka and Kenya. The tea leaves are picked from the fields by
hand to preserve quality, damaged leaves are thrown away. The tea leaves are shipped
thousands of miles to reach the factory in Yorkshire to be blended to achieve the perfect
Yorkshire Tea taste. At its Yorkshire factory, a team of dedicated staff taste up to a thousand
teas a day to achieve the perfect blend, the tea is then packaged for storage. Tea is
distributed to wholesalers and supermarkets in the UK. Taylors of Harrogate also uses 36
different overseas distributors to manage sales across the world.
Yorkshire Tea uses batch production in its factory to produce the tea, it sells
the following range of tea bags in its product portfolio:
© WJEC CBAC Ltd. (C510U20-1) Turn over.
, 3
Examiner
only
• Consumers can choose to buy tea in different quantities, ranging from a box of 40 tea bags to
a bulk bag of 1040.
• Leaf tea (without the tea bag) for customers who prefer to use the traditional method of making
tea in a teapot and using a tea strainer.
• Different versions of Yorkshire Tea including Decaf, Hard Water, Gold, Breakfast.
• New speciality tea flavours include Bedtime, Toast and Jam and Biscuit.
Taylors of Harrogate aims to have a positive ethical impact when producing Yorkshire Tea.
It sees its suppliers as one of its most important stakeholders and is committed to strong,
long-term, ethical relationships.
The business has committed to the following standards when working with its global suppliers:
• Working conditions are safe
• No child labour is used
• Working hours are not excessive • Living wages are paid.
C510U201A
03
Turn over.
2. Bubbles Ltd is a UK based, nationwide supplier of hot tubs. The business was established in
2008 by Barry Wall. Barry started the business as a sole trader. He began by buying inflatable
hot tubs from manufacturers outside the UK such as China, then repackaging them with his
own logo and selling the hot tubs on third-party selling websites such as Amazon and eBay.
Barry started the business from his home storing the inflatable hot tubs in his garage.
The inflatable hot tubs are sent to customers with a
pump so customers can easily assemble them.
Barry had excellent feedback from customers about
the quality of the hot tubs, the clear instructions and
the after sales service. The price of the inflatable hot
tubs sold by Barry ranges between £300 and £500.
© WJEC CBAC Ltd. (C510U20-1) Turn over.
, 4
Examiner
only
Since Barry started the business there has been a big increase in demand for hot tubs.
Due to increasing sales, in 2015 Barry decided to expand the business. Barry was finding it
difficult to keep up with demand. There was also not enough space in the garage to store the
increased quantity of hot tubs. Barry decided to invest in a small warehouse and
distribution centre in an industrial park. In the same year, Barry decided to change the
ownership of the business into a private limited company to become Bubbles Ltd. Barry could
no longer do all the work himself and he employed four staff to help in the warehouse and
distribution centre. He also decided to set up his own e-commerce website for the business.
After continued growth in sales and profit, Barry is
now considering expanding Bubbles Ltd further by
selling more expensive plumbed-in hot tubs as well
as continuing to sell his popular range of inflatable
hot tubs.
If Barry decides to go ahead with the expansion of the
business, he will source the plumbed-in hot tubs from a
UK supplier. The plumbed-in hot tubs are very big and
expensive so he intends to store a limited number of
them in his warehouse and distribution centre. By not
having an expensive showroom where people can see the plumbed-in hot tubs Barry thinks
he will be able to sell the hot tubs at more competitive prices. However, he is concerned about
delays in delivery from the UK supplier to his warehouse and distribution centre resulting in a
long delivery time to the customer.
Barry will have to employ specialist staff to fit the plumbed-in hot tubs. He will also have to
invest in a large van.
Barry carried out primary and secondary market research to help him make a decision. Barry
spent an evening using the internet to carry out some research and found that:
• According to an article in 2019, the UK hot tub market is due to grow by 9.6% between 2021
and 2026.
• A rise in disposable income and awareness about health are factors that have led to growth in
the hot tub market in the USA.
• Rising energy bills could contribute to increased costs for hot tub owners.
• The average price to customers of purchasing a plumbed-in hot tub including installation is
£6000.
Barry also carried out primary market research by creating an online survey for his existing
customers. 50 customers responded and the results showed that:
• 20% of customers said they would consider purchasing a plumbed-in hot tub.
• Customers said they would be willing to pay between £4000 and £7000 for a plumbed-in hot
tub.
• 60% of customers said they would be put off from buying a plumbed-in hot tub if there were
long waiting times for delivery.
• 40% of customers said they would be reluctant to purchase an expensive product without first
seeing it in a showroom.
Selling more expensive hot tubs will be a large financial investment for Barry. He has
estimated the following costs:
• To employ two new members of skilled staff to deliver and fit the hot tubs will
cost £80 000 per year.
© WJEC CBAC Ltd. (C510U20-1) Turn over.
