RiverRoast sells coffee beans to independent cafes. Market research found that several customers want the business to check whether growers receive a fair p...
Question 1 Report
RiverRoast sells coffee beans to independent cafes. Market research found that several customers want the business to check whether growers receive a fair payment. The purchasing manager can keep using the cheapest wholesaler, or choose a certified co-operative whose coffee costs more per kg. RiverRoast aims to increase sales while protecting its reputation as an ethical business.
(a) Identify one stakeholder, other than customers, affected by RiverRoast's choice of coffee supplier. [1]
(b) Explain one reason why responsible sourcing could help RiverRoast meet its business objective. [2]
(c) Which supplier should RiverRoast choose? Explain your answer. [4]
Answer Details
(a) Coffee growers are a stakeholder affected by the supplier choice. [1] Employees, owners or shareholders, café customers and the local community would also be acceptable.
(b) Responsible sourcing can improve RiverRoast’s reputation as an ethical business. [1] Customers who value ethical products may then buy its coffee, helping the business increase sales. [1]
(c) RiverRoast should choose the certified co-operative. [1] It is more likely that growers receive fair payment and that working conditions are monitored, which supports ethical business behaviour. [1] This can strengthen RiverRoast’s reputation with customers who want responsible products. [1] Greater sales or customer loyalty may outweigh the higher cost per kg. [1]
A choice of the cheapest wholesaler could also be credited if it is justified by lower costs, lower prices and maintaining competitiveness. However, it would need a credible way to improve worker conditions to address RiverRoast’s ethical objective and customers’ concerns.
Download The App On Google Playstore
Everything you need to excel in your exams
