Technological Factors
What is meant by new technology in a business? Give an example.
A new or improved tool, system, machine, software, or process that changes how the business operates; e.g., automation, online ordering, AI forecasting, self-service kiosks, or electric equipment.
What are customs duties?
Taxes or charges placed on goods imported into New Zealand.
What is a resource-management law?
A law or regulation that controls how a business uses land, water, air, waste, energy, or other natural resources to reduce environmental harm.
What is a demographic change?
A change over time in the characteristics of a population, such as age, income, ethnicity, family structure, location, or population size.
What does kaitiakitanga mean in a business context?
Guardianship or responsible stewardship of resources, people, and the environment for present and future generations.
Explain one reason why a large business may invest in new technology.
To improve efficiency, productivity, accuracy, customer service, or competitiveness. For example, automation can complete repetitive tasks faster and with fewer errors.
Explain why an increase in customs duties can increase a business’s operating costs.
If the business imports stock, ingredients, machinery, or components, it must pay more to bring those goods into New Zealand. Its cost of goods sold or production costs increase.
Give one reason why a business should comply with laws about the management of resources.
Compliance helps the business avoid legal penalties, protect the environment, maintain its licence to operate, and meet community or customer expectations.
Explain why businesses use employment contracts.
Contracts clarify pay, hours, duties, leave, workplace expectations, and rights. This reduces confusion and disputes and helps the business meet employment-law obligations.
Explain how consulting an employee while creating their employment contract can demonstrate tikanga.
It shows respect, fairness, participation, and culturally appropriate practice. The employee can contribute to decisions that affect them, supporting a more respectful employment relationship.
A retailer introduces self-service checkouts. Explain one positive impact on the business.
Self-service checkouts can reduce queue times and improve customer convenience. This may increase customer satisfaction and repeat purchases, lifting sales revenue; it can also allow staff to focus on customer support or restocking.
Explain how higher import costs could affect both the sales/marketing function and the production function of a business.
Production may become more expensive because imported inputs cost more. Marketing/sales may need to increase prices or promote alternatives; higher prices may reduce demand and sales, while absorbing the cost reduces profit margin.
Explain one positive and one negative impact on a business that complies with environmental resource laws.
Positive: Less pollution or waste can strengthen reputation and stakeholder trust, potentially supporting sales and community relationships. Negative: The business may face compliance costs, such as new equipment, monitoring, training, permits, or cleaner processes, increasing operating expenses in the short term.
Employees take work-to-rule industrial action. Explain what this means and one likely impact on the business.
Employees complete only the duties and hours required by their contracts, without voluntary extra work. Productivity, production, service speed, or delivery times may fall, causing customer dissatisfaction, lost sales, and lower profit.
Explain one way a large business could demonstrate rangatiratanga.
The business could show responsible leadership and self-determination by making long-term decisions that uphold its values and benefit its people and community; for example, involving mana whenua in decisions affecting local land or resources.
A manufacturer installs automated machinery. Analyse one potential negative impact on employees and the business.
The machinery may reduce the need for some roles or require workers to be retrained. This can lower employee morale or create resistance to change; training, redundancy, or recruitment costs may initially increase operating expenses and reduce short-term profit.
A business changes to a local supplier, but the local supplier charges more. Analyse two actions the business could take to remain economically sustainable.
It could negotiate volume discounts or a long-term contract to lower unit costs; it could improve efficiency or reduce waste to offset higher input costs; it could make a carefully justified price increase; or it could market the local/environmental benefit to support a premium price. Each action must link to maintaining revenue, lowering costs, or protecting profit.
A food producer changes to recyclable packaging to meet environmental expectations. Analyse the likely effect on customers and profitability.
Some customers may view the business as responsible and become more loyal, supporting sales and brand reputation. However, recyclable packaging may cost more, reducing profit margin unless the business reduces other costs, sells more units, or charges a price that customers will accept.
A business finds that its customer population is becoming older. Analyse two actions it could take to remain economically sustainable.
It could adapt products, store layout, packaging, service, or accessibility to meet older customers’ needs; it could improve online ordering and delivery for convenience; or it could target new customer segments while retaining older customers. Each action must show how it protects or increases sales and profitability over time.
A business replaces cheaper plastic packaging with compostable packaging. Analyse one cost/challenge and one longer-term benefit of demonstrating kaitiakitanga.
Compostable packaging may have higher purchase costs, require supplier changes, or need customer education, increasing operating expenses in the short term. However, it can reduce environmental harm, meet societal expectations, strengthen community/customer trust, and protect the brand’s long-term reputation and sales.
A business is deciding between investing in an online ordering app or upgrading its in-store technology. Which option should it choose? Justify your answer using two reasons.
(Answers will vary. A justified response chooses one option, applies it to the named business and gives two linked reasons.) Example: choose an ordering app if customers value convenience and the business can reach more customers beyond physical stores; this may increase sales and customer data, although start-up and cybersecurity costs must be managed. Upgrading its in-store technology will improve overall customer experience, but it won't allow them to reach new markets through online targeting. I recommend investing in an online ordering app because we live in a globally connected, online world where more and more people are adopting this approach to buying what they need.
A business faces higher import costs. Is it better to raise prices or find a cheaper/local supplier? Justify one option using two reasons.
Answers will vary. A strong answer compares both options, then chooses one in context. For a price-sensitive market, finding an appropriate supplier may protect demand and sales. A local supplier may also reduce transport emissions, strengthen supply reliability, and meet societal expectations, although its higher unit cost must be offset through efficiency or premium positioning.
Does complying with environmental resource laws improve relationships with two stakeholder groups? Justify your answer.
Yes, usually. The community benefits from reduced pollution and may be more willing to support the business. Customers may trust the brand more when it behaves responsibly. A strong answer also recognises a trade-off: shareholders may be concerned about short-term compliance costs, but lower legal risk and stronger reputation can protect long-term profitability.
Employees threaten to strike because they believe pay is unfair. Should management negotiate a pay agreement or hire replacement workers? Justify your preferred action.
Answers will vary. Negotiating is often more sustainable because it can restore trust, reduce disruption, retain trained workers, and protect customer service and reputation. It may increase wage costs, but replacement workers can be expensive, less skilled, and may intensify conflict.
Do the benefits of demonstrating rangatiratanga or kaitiakitanga outweigh the costs for a large business? Justify your answer with two reasons.
Yes, in most contexts. Responsible practice can strengthen trust with customers, iwi, communities, and regulators, protecting the business’s social licence to operate. It can also reduce long-term environmental, legal, and reputational risk. A high-quality answer acknowledges up-front costs, then explains why long-term stakeholder relationships, brand reputation, and sustainable profitability are more important.