1.5 Stakeholders in Business Practice Questions

This question is about stakeholders. You do not need to refer to a particular business in your answers.

Holmbrook Joinery Ltd

Holmbrook Joinery Ltd makes wooden windows and doors in a small town in Lancashire. It employs 60 people, most of whom live in the town, and buys its timber from a sawmill eight miles away. Its customers are local builders and homeowners.

Last year sales fell by 12% and the company's profit fell sharply. The directors have decided to reduce costs. Their plans are to:

• stop paying overtime, which many employees rely on to increase their pay
• buy cheaper imported timber instead of timber from the local sawmill
• close the workshop on Saturdays, when many homeowners collect their orders.

Text 2

Beckfield Bikes Ltd

Beckfield Bikes Ltd is a private limited company that sells and repairs bicycles. It began as one shop in a small market town 12 years ago and now has four shops and a repair workshop on a business park at the edge of the town. The company employs 46 people, including 14 part-time mechanics.

All frames and parts are bought from three UK suppliers, who are paid 60 days after delivery. The newest shop stays open until 10pm and the delivery vans begin loading at 6am. Some residents living near the business park have complained about noise and about parking on nearby streets.

The owners, Priya Deshmukh and Tomas Lindqvist, want to open two more shops within three years. Last year sales rose and the company paid £84 000 in tax. Beckfield Bikes Ltd offers free delivery on every bicycle sold.

Table 1 – Reason given by customers for choosing Beckfield Bikes Ltd (survey of 120 customers)

Reason given	% of customers
Low prices	38
Quality of repairs	27
Free delivery	20
Convenient opening hours	15

Text 2 — Fennside Drinks Ltd

Fennside Drinks Ltd is a private limited company that makes sparkling fruit drinks. It was started 12 years ago by Annika Thwaite in a converted barn in the village of Fennside and now supplies cafés and independent shops across the north of England. The company buys its fruit from 14 growers within 30 miles of the factory and pays each grower 30 days after delivery.

Demand has grown quickly. To keep up with orders, Fennside Drinks Ltd has added an evening shift, so the factory now runs from 06:00 until 22:00, six days a week. Lorries collect finished drinks each evening. Some residents have written to the company about the noise.

Customers tell Fennside Drinks Ltd that they want a wider choice of flavours and drinks containing less sugar. Annika and the other two shareholders want the company to keep growing.

Table 1

	2022	2024
Number of employees	24	41
Number of flavours sold	6	9
Customer complaints received	85	212

Marchwood Mill Ltd

Marchwood Mill Ltd is a family-owned bakery in the village of Marchwood. It is owned by Meena and Ravi Chandra, who are the only shareholders. The bakery employs 45 people, most of whom live in the village, and it buys all of its flour from a farm two miles away. Its bread is sold to 60 local cafés and shops.

Meena and Ravi want to increase the dividends they receive from the business. They are considering spending £120 000 on automated ovens so that bread can be baked 24 hours a day. Lorries would then collect bread during the night as well as during the day. Some villagers have already complained about noise and traffic from the bakery.

Marchwood Mill Ltd	Now	After new ovens (forecast)
Employees	45	37
Loaves produced each day	6 000	9 000
Cost of producing one loaf	£0.46	£0.38
Lorry deliveries each week	30	48

Larkfold Brew

Larkfold Brew is a craft brewery run as a partnership by Nina Okafor and Rob Shanley. It is based in a converted barn in the village of Thornby, nine miles from Leeds. The business brews 1 200 barrels of beer a year, which it sells to 40 pubs across West Yorkshire and in its own taproom, open on Friday and Saturday evenings. Nina and Rob employ four people and buy their barley from a farm in the next village.

The partners have agreed to install new brewing tanks so that Larkfold Brew can produce 1 500 barrels a year. Deliveries will increase from two to five lorry journeys a week. The partners are also deciding whether to open the taproom five evenings a week, which would mean employing two extra staff.

Some Thornby residents have formed a group called Quiet Thornby. They have complained to the local council about lorry noise early in the morning and about taproom customers parking in the narrow village streets. Quiet Thornby has asked the council to limit the hours the brewery can operate.