Refer to the As Fair As case study (SL/HL paper 1 Nov 2018).

Describe two external stakeholders of AFA, other than customers.

Refer to the As Fair As case study (SL/HL paper 1 Nov 2018).

With reference to AFA, explain the importance of branding.

External stakeholders include:

• customers (not allowable for this question)
• suppliers – originally nervous about supplying Sam’s new business. Need to conform to fair trade principles. Could include mystery shopper if it is clear that this is not an employee
• government – for taxes, data etc. Includes a Companies House role for proper accounts. Could include trading standards for ethics. Could include licensing issues. No evidence as to whether government wants to encourage fair trade or not.
• banks and other creditors – at times AFA needs finance for expansion
• special interest groups/pressure groups, eg charities, NGOs, pressure groups – there is a fair trade movement (no need to use terms like special interest groups)
• the community – little evidence in case so not a good one to choose to get context mark
• competitors – supermarkets also stock fair trade products.
• possible external sources of finance.

N.B.: Shareholders are NOT external.

Mark as 2 + 2.

Award [1] for each correct element identified and [1] for a description of how that feature relates to AFA. Award a maximum of [2] per element.

Refer to Paper 1 markbands for May 2016 forward, available under the "Your tests" tab > supplemental materials.

The importance of branding to AFA can be classified in a number of areas:

• competition: branding can be used to differentiate eg from supermarkets.
• USP: AFA seeks to be the only dedicated fair trade store. Branding can enhance this USP
• pricing: A well-developed brand can help AFA set premium prices, helping profits which need improving.

The importance can be developed through:

• the need to attract customers (eg, to the new stores)
• the need to encourage repeat purchases, eg through brand loyalty.

Accept any other relevant explanation.

Marks should be allocated according to the paper 1 markbands for May 2016 forward, section A.

Award a maximum of [3] for a theoretical answer, often a pre-prepared textbook answer

Award a maximum of [5] if the explanation is mainly descriptive, but in context.