SQA National 5 Business Management Unit 2 Management of Marketing and Operations

What Unit 2 actually demands

Management of Marketing and Operations is about how a business sells its products and how it makes them. The SQA tests precise knowledge of the marketing mix and production methods, and the ability to apply them to a business in the question. This guide walks through both parts of the unit, then sets out how it is examined. Each topic has a matching dot-point page with worked questions; this overview ties them together.

Marketing and market research

Marketing identifies and satisfies customer needs and wants at a profit. A business identifies its customers through market segmentation (by age, gender, income, location or lifestyle) and gathers information through market research, which is either field (primary) research (new data collected first hand) or desk (secondary) research (existing data). The named research methods - questionnaire, interview, telephone and postal survey, focus group, consumer panel, hall test and observation - each have strengths and weaknesses.

The marketing mix

The marketing mix is the four Ps. Product covers new product development, branding and the product life cycle (introduction, growth, maturity, decline) with extension strategies. Price covers strategies such as penetration, skimming, competitive and promotional pricing. Place covers channels of distribution. Promotion covers the methods used to make customers aware and persuade them. The unit also covers ethical marketing and the role of technology.

Operations

The operations part covers choosing suppliers through the purchasing mix (price, quality, reliability, quantity, lead time), managing inventory to avoid over-stocking and under-stocking, the three methods of production (job, batch, flow), the methods of ensuring quality (control, assurance, TQM, standards, quality circles, benchmarking), and the ethical and environmental issues of waste, packaging and sustainable sourcing.

How Unit 2 is examined

A typical SQA profile for this unit:

• Knowledge of the mix and methods. Naming and describing the four Ps, research methods, production methods and quality methods earns straightforward marks.
• Application to a context. Choosing a pricing strategy or production method for a given firm rewards a justified choice, not just a definition.
• Explained benefits and comparisons. Explaining the benefits of quality or comparing production methods needs a cause and an effect, or genuine points of difference.

Check your knowledge

A mix of recall and reasoning questions covering Unit 2. Attempt them, then check against the solutions.

1. Name the four elements of the marketing mix. (2 marks)
2. State the difference between field and desk research. (1 mark)
3. Name the four stages of the product life cycle. (2 marks)
4. Name the three methods of production. (1 mark)
5. State the difference between quality control and quality assurance. (2 marks)