BUSINESS STUDIES
This coursework I will look at whether large supermarkets are more competitive than a small corner shop. A large supermarket is judged by the size of its labour force, turnover and capital employed. Large supermarkets are usually more successful because of the economies of scale. Some of the economies of scale a firm can gain, as it grows larger. These internal economies of scale are called Technical, financial, managerial, marketing, buying and risk-bearing economies. Large firms can buy larger and more efficient machinery and equipment and this means a firm can produce more at a lower price. Large firms can take advantage of production lines and divisions of labour. It's cheaper for a large firm to store and transport goods in large warehouses and lorry's that hold twice as much as smaller firms. Large firms can get larger loans at lower rates of interest because they have more assets that they can use in security. Large firms can afford to pay for specialised staff to manage different parts of their firm but smaller firms may have to do these tasks themselves. To advertise large number of products and bring the average cost down you have to have effective advertising. Bulk buying is when a large firm can buy in large quantities and at lower prices. If there is a drop in demand larger firms suffer less than smaller firms because they sell a wider range of products in more areas.
This coursework I will look at whether large supermarkets are more competitive than a small corner shop. A large supermarket is judged by the size of its labour force, turnover and capital employed. Large supermarkets are usually more successful because of the economies of scale. Some of the economies of scale a firm can gain, as it grows larger. These internal economies of scale are called Technical, financial, managerial, marketing, buying and risk-bearing economies. Large firms can buy larger and more efficient machinery and equipment and this means a firm can produce more at a lower price. Large firms can take advantage of production lines and divisions of labour. It's cheaper for a large firm to store and transport goods in large warehouses and lorry's that hold twice as much as smaller firms. Large firms can get larger loans at lower rates of interest because they have more assets that they can use in security. Large firms can afford to pay for specialised staff to manage different parts of their firm but smaller firms may have to do these tasks themselves. To advertise large number of products and bring the average cost down you have to have effective advertising. Bulk buying is when a large firm can buy in large quantities and at lower prices. If there is a drop in demand larger firms suffer less than smaller firms because they sell a wider range of products in more areas.
