Edexcel GCSE Business: Stakeholders and technology (1BS0) – Revision Notes

These notes condense Theme 1, Topic 1.5 Understanding external influences on business, items 1.5.1 and 1.5.2, of the Pearson Edexcel Level 1/Level 2 GCSE (9-1) in Business (1BS0) specification, Issue 2, July 2022. The study guide has the full explanations and worked examples, so read it first. Then try the practice questions.

Course links: the Business hub, the printable checklist and the free diagnostics. Related pages: aims, objectives, revenue, costs and profit and limited liability and business location.

1.5.1 Business stakeholders at a glance

A stakeholder is anyone, or any group, affected by or concerned with a business’s actions (standard meaning). The specification lists eight groups.

Group	Wants (typical examples)	Can affect the business by
Shareholders (owners)	Profit share, rising share value	Pressing for profit, changing managers
Employees	Pay, security, good conditions, training	Effort, quality of work, leaving, taking industrial action
Customers	Quality, fair price, safety, service	Buying or not buying; reviews
Managers	Salary, growth, secure post, freedom to decide	Setting direction and daily decisions
Suppliers	Regular orders, prompt payment	Prices, delivery times, stopping supply
Local community	Jobs, little noise or pollution	Objecting to plans, using or avoiding the business
Pressure groups	A change in business behaviour	Campaigns that shape public opinion
The government	Tax, jobs, law kept, economic health	Taxes and rules

The specification does not fix a list of objectives, so treat the entries above as examples that you can adapt.

Affected by, and impact on

Two separate directions. Keep them apart in an answer.

• Affected by the business: the business acts and the group feels the result. A late-night delivery schedule affects neighbours; late payment affects a supplier.
• Impact on the business: the group acts and the business feels the result. Customers leaving bad reviews cut sales; a supplier raising prices lifts costs.

Method in steps for a stakeholder question

1. Name the group or groups in the case.
2. State what that group wants.
3. Link the business decision to that want.
4. Say who gains and who loses.
5. Add a consequence for the business, such as sales, costs or reputation.

Conflicts between stakeholder groups

Pair	Source of conflict
Shareholders vs employees	Wages come out of the profit that could be shared
Shareholders vs customers	Low prices or high quality cost money
Managers vs shareholders	Pay and growth plans against returning profit to owners
Local community vs owners	Expansion and long hours against quiet
Pressure groups vs managers	Costly changes demanded by a campaign
Suppliers vs the business	High prices against low costs

A conflict answer needs two groups, two different wants and a reason they cannot both be fully met. Add a way to ease it: talks, a trial period, a phased change or a bonus.

1.5.2 Types of technology

Type	What it is (standard meaning)	Example
E-commerce	Buying and selling over the internet	A pottery sold through its own website
Social media	Platforms for posting, talking and advertising	Short videos showing how a product is made
Digital communication	Electronic communication inside and outside the business	Email, video calls, messaging apps
Payment systems	Electronic ways of taking or making payments	Card readers, contactless, online payment

Influence on sales, costs and the marketing mix

Area	Possible gains	Possible drawbacks
Sales	Wider market, orders at any hour, more awareness	Website faults lose sales; more rivals visible online
Costs	Less postage, printing and travel; smaller premises	Set-up, training, delivery, packaging, fees per sale
Product	Quick feedback; digital products	Comments can expose faults
Price	Lower selling costs allow lower prices	Easy price comparison forces prices down
Promotion	Cheap, targeted posts and email	Needs time to manage; a bad post spreads fast
Place	Website works as a place to buy	Delivery must be reliable

Marketing mix: product, price, promotion, place.

Small calculations you may need

Formulae are listed in the specification and are not provided, so learn the ones you use.

Revenue and total cost are given in Appendix 3. Profit and percentage change are not listed there; they are standard forms.

• Revenue = price × quantity.
• Total cost = total fixed costs + total variable costs.
• Profit = sales revenue − total costs (the standard form, not an Appendix 3 formula).
• Percentage change = change ÷ original × 100 (the standard form).

Reminder: a business sells 40 online orders at £25 each, so revenue is 40 × £25 = £1,000. A payment fee of 3% costs £30.

Worked reminders

A supplier raises its prices

Ashby Veg Boxes buys £5,000 of seed and packaging a year. Its supplier raises prices by 8%.

1. Extra cost = £5,000 × 0.08 = £400.
2. New annual cost = £5,000 + £400 = £5,400.
3. Link to the groups: the supplier gains income, the owners lose profit unless Ashby raises its prices, and customers may pay more.

This is an impact of a stakeholder on the business. The business then chooses how to respond.

A social media campaign

Ashby spends £180 on social media adverts. They bring 36 extra orders at £15 each. Stock for these orders costs 60% of the sales revenue.

1. Extra sales revenue = 36 × £15 = £540.
2. Stock cost = £540 × 0.60 = £324.
3. Profit from the campaign = £540 − £324 − £180 = £36.

The campaign pays for itself, but only just. A fuller answer would add that new customers may buy again, and that the result depends on the 60% stock cost staying the same.

Writing a developed answer

When a question says explain, give a statement of fact and two expansion points. For one that asks you to analyse, use a chain of reasoning placed in the business described:

• Point: the business has taken a particular step.
• Because: say what that does to a named group or to sales, costs or the marketing mix.
• Which means: say what follows for the business, such as profit, reputation or loyalty.

For an evaluate question, set out a point for and a point against, then give a decision that follows from the case and say what would change it. For a justify question, choose one of the two options and give a reason that uses the information provided.

Must-know distinctions

• Affected by versus impact on.
• Social media (a platform for posting and talking) versus digital communication (passing information electronically).
• E-commerce (the buying and selling) versus payment systems (the way the money moves).
• A benefit to sales versus a benefit to costs: do not mix them.
• Command words as the specification describes them: explain means a statement plus two expansion points with no context; outline means two linked points placed in context; analyse expands a point in the context given; justify picks one of two options to recommend; evaluate ends in a supported conclusion.

Quick self-test

1. Name the eight stakeholder groups in the specification.
2. Give one objective of employees and one of the government.
3. A bakery has a wage bill of £64,000 and gives a 9% rise. Calculate the new wage bill.
4. State one possible conflict between shareholders and customers.
5. Explain one way a supplier can impact a business.
6. Define e-commerce.
7. A café lets customers pay by tapping a phone on a reader. Which type of technology is this?
8. Sales revenue rises from £25,000 to £30,000. Calculate the percentage change.
9. A card reader charges 2% on card sales of £1,850. Calculate the fee.
10. A shop sells 120 items at £45 each with total costs of £3,100. Calculate the profit.
11. Name the four elements of the marketing mix and give one way technology influences place.

Answers

1. Shareholders (owners), employees, customers, managers, suppliers, local community, pressure groups, the government.
2. Employees: for example fair pay or job security. Government: for example tax revenue or more jobs.
3. 64,000 × 1.09 = £69,760.
4. For example, customers want lower prices while shareholders want higher profit.
5. A supplier may raise prices, which lifts the business’s costs and may force it to raise its own prices or accept lower profit.
6. Buying and selling goods or services over the internet.
7. Payment systems.
8. (30,000 − 25,000) ÷ 25,000 × 100 = 20%.
9. 2% of £1,850 = £37.
10. Revenue = 120 × £45 = £5,400; profit = £5,400 − £3,100 = £2,300.
11. Product, price, promotion, place. A website lets customers buy without visiting a shop, so the website becomes a place of sale.

Where marks are usually lost

• Writing a group name without saying what it wants.
• Mixing up which direction an influence runs, or giving only one.
• Giving a conflict between two groups without saying why both cannot be satisfied.
• Describing technology in general without linking it to sales, costs or a marketing mix element.
• Forgetting that technology also adds costs.
• Giving points that fit any business instead of using the facts in the case.
• Calculating without showing working, or leaving out the unit (£ or %).
• Writing a list for an evaluate question and no supported conclusion.

Frequently asked questions

Who are the stakeholders of a business in Edexcel GCSE Business? The 1BS0 specification names eight groups: shareholders (owners), employees, customers, managers, suppliers, the local community, pressure groups and the government.

What is a stakeholder? A stakeholder is anyone, or any group, affected by or concerned with a business’s actions. The specification lists the groups rather than defining the word, so this is the standard meaning.

What types of technology does the specification name? It names e-commerce, social media, digital communication and payment systems. You need to explain how they influence a business’s sales, costs and marketing mix.

Is a pressure group a type of customer? No. Pressure groups are not owners, staff or customers; they choose a cause and try to change how a business behaves, often by drawing public attention to it.

Official syllabus

Pearson Edexcel Level 1/Level 2 GCSE (9-1) in Business (1BS0), Specification, Issue 2, July 2022, published by Pearson Education Limited. Theme 1: Investigating small business, Topic 1.5 Understanding external influences on business, items 1.5.1 and 1.5.2.