Business Studies

  • Created by: Sarah
  • Created on: 16-06-15 18:12

Impact of Technological Changes: Emma Bridgewater

  • global reputation
  • designs deman all over the worl
  • E-commerce site - manufacture in UK but sell & distribute globally
  • not needed to set up retail outlet
  • customers can compare competitor's prices and view alternative options
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Impact of Technological Changes: Formula 1

  • over 50% of teams chose to conduct opertaions in UK
  • best engineers and facilities
  • produce reliable and powerful engines

Carterham Cars

  • specialist lightweight sports cars
  • has gained international reputation for its iconic cars and the speed and agility of its designs


  • distinguished name and reputation in F1
  • made the move into the premium road-going sports cars
  • keen to use the exoertise it has acquired in F1 sector to develop and expand into premium-priced market nichr of super-performance sports cars - highly profitable for Ferrari (major competitor)
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Impact of Technological Changes: Aston Martin

  • uses job production techniques - NO MASS PRODUCTION
  • most desirable high-end street-going sports cars
  • gives USP and excellent build quality
  • people pay substantially more


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Impact of Technological Changes: Dyson

  • lowered cost by manufacturing in Malaysia
  • kept R&D base in UK
  • best location for innovation & development of new technology 
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Impact of Technological Changes: Chemical Industry

  • years of experience and understanding of processes required in UK
  • employs over 600,000 people at numerous manufacturing sites
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Impact of Technological Changes: Jaguar Land Rover

  • considerable growth in emerging markets
  • strong performance exporting high end, high quality automotives
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The impact of increasing globalisation: Shoe indus

  • UK manufacturers has been dominant
  • perceived monopoly has been broken up on anti-competitive ground
  • they no longer enjoy the purchasing economies of scale that resulted in lower unit costs of production
  • enabled them to produce shoes at more competitive prices than rival firms

Standard of living in UK increased = demanding higher wages

  • cost disadvantage compared to emerging economies that can pay much less
  • UK shoe manufacturers are no longer price competitive in the mass market =fading industry

Certain shoe companies = increased globalisation 

  • trading on reputation for producing high end and fashionable products

Jeffery West and Hunter

  • benefited from being able to sell their products globally
  • trend in one country quickly spreads
  • media helps
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Impact of increasing globalisation: Cars

China and India have been a major threat on UK manufacturing (BRIC countries)

UK only has 4 major domestically owned car producers.

Market dominated by major producers e.g. GM, Ford and VW --> over 35 Chinese manufacturers in top 50 car producers

  • quality and reputation of these producers is quetsioned

Jaguar Land Rover (no owned by Tata, an Indian conglomerate)

  • perceived threat of ghlobalisation into huge opportunity
  • more sales in China than any market
  • enables firm to expand its operations both in China and UK


  • expertise and knowlede of workers in UK is substantial
  • company can access the skills and make use of technology and training that is unrivalled elsewhere
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Impact of government policy: Military aircraft

Bae and Qinetiq

  • significant growth in markets
  • awarding of major public spending contracts are under close scrutiny
  • leaders in fields and successfully secured these contracts
  • increased orders/ increased employment opportunities / increased profitability
  • without UK government support - would be harder to succeed
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Impact of government policy: Rail Industry

ambitious plans to improve rail networks e.g. HS2 and HS3 should benefit many manufacturing firms and in particular builders e.g. Bombardier


  • announced plans to invest in new rolling stock
  • contrcat went to German firm Siemens --> job cut in Bombardier factory
  • increase in unemployment benefit payments = reduced spending in local economy


  • Siemens created more than 300 jobs in UK
  • government shouldn't intervene as company needs to be able to choose its own supplier of key components
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Impact of Government Policy: Cadburys

Taken over by US giant Kraft

  • Keynsham plant, near Bath, was shut down and sold off
  • major impact on local community

cheaper to mover production to a plant in Poland

  • Cadbury's is iconic and trusted British brand
  • considerable backlash for both UK government and Kraft board of directors


Purchasing decisions based on taste not where manufactured

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Impact of Government Policy: British Steel

  • Domestic Monopoly
  • Once owned by government
  • tolerated because it could compete more effectively in global market


  • major competition from Corus and Tata Steel = decline in UK steel industry


  • traditionally taken place in Sheffield and Middlesborough
  • hit hard by unemployment
  • Steel plants have shut down, and with them those firms that have traditionally supplied the major plants
  • reduction in job opportunities, downward pressure on house prices and negative impact on local economy
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Factors Affecting UK Location: ARM Technology

Success = design and innovation stage rather than producing and manufacturing final product

  • specialised in designing circuits that go in processors and chips in most smartphones and consoles
  • based on outskirts of Cambridge
  • enables ARM to access and recruit some of the finest academic mind in country because near uni has a long history of tech and scientific excellence
  • large pool of skilled workers = able to atract and retain high-calibre staff
  • staff work closely together in developing the latest technology to allow it to remain at the forefront of industry

chips are made in Malaysia

  • chips are very small means that the transportation costs of sending these chips to major mobile manufacturers around the world is relatively low
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Factors Affecting UK Location: Boeing and Airbus

dominated the commercial aerospace industry, despite high cost locations e.g. USA and UK

  • enjoy high levels of profitability
  • considerable power over suppliers
  • manufacturers are keen to gain contracts with these large firms and over their buyers since the airlines have to choose aircraft from one of the two main suppliers

High level of competition between companies

  • demand for airlines is sufficiently strong for them to remain highly profitable
  • reputation for quality and high levels of engineering more than offsets the relatively high-cost locations of these firms to ensure continues success
  • demand for finsihed aircraft contines
  • location is not major determinant of profitability but rather the nature of the industry itself.
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Factors Affecting UK Location: Zara

  • largest clothing manufacturer in the world
  • chooses to produce majority in Spain

Some produced in lower-cost sites in Eastern Europe

  • company could lower costs further by choosing locations in emerging countries
  • recognises that a very lean and efficient operations management chain is critical for continues profitability
  • enables the company to meet demand in this fast-moving industry and has been the main determinant of profitability
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Factors Affecting UK Location: Primark

clear focus on cost leadership and provides cheap and affordable clothing for UK high street

  • focus = selling large quantities of clothing with low profit margin
  • only possible through sourcing and producing clothes in countries with very low costs of production
  • led to substantial amount of negative publicity = conditions and pay of workers
  • raises serious ethical questions and turns the spotlight on corporate social responsibility

Primark continues to post ever-increasing profits year on year

  • suggest state of economy and desire of consumers to 'bag a bargain' outwight considerations


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Opportunities & Threats: British Food & Drink Indu

Continues to prosper

  • international rivals can produce products at a fraction of the price of domestic producers
  • deman for organic and high end quality goods is strong

Sibling Distillery and William Chase Vodka

  • maintain high profity margins

Aldi and Lidl

  • rise of low-cost supermarkets
  • forced UK suppliers and manufacturers to raise their game
  • more productive and efficient
  • now operating in such an intensely competitive industry
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Opportunities & Threats: UK furniture industry

Rise of low-cost Swedish giant IKEA


  • ability to produce a large number of items and benefit from econoies of scale in production


  • not all consumers wish to live in the sam 'identikit' house

Deman for unique and distinctive furnitiure is stills trong and likely to remain so as people seek to epxress their individuality through their houses

  • willing to pay higher prices for goods that stand out
  • UK furniture manufacturing flourish despite increased competiton and the emergence of cheaper manufacturers overseas
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Opportunities & Threats: UK automotive industry

Only four British firms

  • industry is trying hard to fight back, especially in relation to higher end market
  • mass production = unlikiely to ever regain position as one of world's centres of car production

GM, Nissan and Toyota

  • choose to produce in UK
  • location decisions have been made strategically
  • avoiding trade barriers, rather than reasons related to manufacturing expertise or cost of production
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Opportunities & Threats: Jaguar Land Rover

Increased 'over time'

current economy is arguably favourable for manufacturers, especially for those that are relatively cheaper, interest rates have been low and continue to remain low.

offers a great opportunity for businesses to borrow and expand their operations so that they can increase thei international competitiveness

  • has explanded its UK fatcory 
  • developed its operations further in China
  • means the factory can supply directly its two main markets - the EU and China
  • JLR may be concerned about the number of Chinese car manufacturers entering the market
  • distinctive brand and reputation that is unlikely to be affected by these new entrants
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