GCSE Business: Going Public, Location and Added Value

This material brings together four topics from the business activity section of the DfE GCSE subject content for business that are easy to overlook: the public limited company, business aims and objectives as they change over time, the factors that influence where a business is located, and added value.

The public limited company is compared with the private limited company. The key difference is who may buy the shares. You then weigh up flotation: a very large source of permanent finance against the cost, published accounts, diluted control and the risk of a takeover. One question works out how much of a company the founding family still owns after new shares are sold to the public.

Objectives are followed from a single café trying to survive its first year to a chain aiming for market share, international expansion and shareholder value. You also meet the changes in market conditions, technology or legislation that can push a business back from growth to survival (for example Pearson Edexcel, topic 2.1.2).

Location questions set real choices: a gravel plant that should sit by its quarry, a salon for which a busy street may be worth the higher rent, and an online shop that can go wherever premises are cheap. One written task compares two factory sites on their combined rent and delivery costs. Added value is calculated as selling price minus the cost of bought-in inputs, then explained through branding, quality, design and convenience, and kept separate from profit.

The quiz has twelve questions and the flashcards hold the terms. The written work has eight tasks, including a justified recommendation on whether a growing chain should float. In the oral exam the examiner asks one question at a time and ends with short feedback. The material is practice written by Zestly and is independent of any exam board.

• Distinguish a public limited company from a private limited company
• Evaluate the advantages and disadvantages of becoming a plc and floating on a stock exchange
• Calculate the effect of issuing new shares on the founders' percentage ownership
• Explain how and why business objectives change as a business grows
• Analyse the factors influencing business location, including the effect of e-commerce
• Calculate added value, explain ways of adding value, and distinguish added value from profit

Practice material written by Zestly, based on the DfE GCSE subject content for business (December 2015: business activity: location, types of ownership, aims and objectives) and, for example, AQA GCSE Business 3.1.2, 3.1.3 and 3.1.5 and Pearson Edexcel GCSE Business topics 1.1.3, 1.4.2, 2.1.1 and 2.1.2.