BP B2 Tests Unit3
BP B2 Tests Unit3
BP B2 Tests Unit3
Name:_________________________________
Reading family businesses with little spare cash realise they cannot
BECV/BULATS survive for long if the staff are unhappy and unable to work
collaboratively. In these businesses, management is still
7 Read the article and choose the correct answer closely involved with the staff, but as a business grows
a, b, c or d. managers tend to lose touch with the people who have built
up the company and keep it going.
Boosting profitability
Therefore, in order to move forward, companies would be
Companies both large and small are concerned about
well advised to maximise the use of their skilled staff and
profitability and yet they seem to manage to waste
focus on the value of employee contribution to the overall
resources in every area. Small businesses are often so busy
success of the business. By building talented teams and
that they have no time to keep an eye on savings; and
creating an environment of support and reward for
although huge multinationals can afford accountants to
employees, the company will achieve its goals, which
keep track of spending, their companies often overlook
will in turn lead to improved profitability.
small amounts of wastage. But these small amounts are
multiplied many times and therefore can become extremely
large sums of money. 1 In the first paragraph, we learn that
a managers of smaller companies watch savings closely.
It is therefore necessary to regularly reassess expenditure b large organisations focus on profitability more than
and look for ways to cut costs in order to boost profits. small businesses.
The changes required can seem obvious to outsiders, but c large companies might ignore what seems like
not to those busy running the company. Often the first thing insignificant waste.
companies look at are overheads (indirect costs, i.e. money d small amounts of waste are unimportant.
that a business has to spend on rent, electricity, etc) and
direct costs (costs relating to a particular product or 2 The writer suggests that companies
service). One overhead cost for most companies is the a often fail to see what is obvious.
premises it uses. So, the first question is: are the premises b usually pay far too much for overheads.
being used efficiently or do they need to be smaller? c need to be busy all the time.
Alternatively, could unused space be rented out to other d work with other companies to find space.
businesses?
3 When reducing overheads, the article also advises
Other areas where overhead savings could be made are a implementing more processes.
within the common processes and procedures, which can b checking how staff are coping with new practices.
become disorganised across large organisations, and which c giving staff lots of practice with new systems.
should therefore be standardised wherever possible. d operating different systems across the globe.
However, once a system or practice has been standardised,
the company must monitor how it is working and ensure 4 In the fourth paragraph, the writer warns about
that employees are following any new procedures. a repaying expensive financial deals too quickly.
b agreeing to suppliers’ new terms and conditions.
Reviewing supplier contracts can also help to identify ways c damaging quality by cutting supplier costs.
of reducing costs. A company should have the best deal d borrowing from banks with cheaper rates.
available from all its suppliers and needs to regularly
renegotiate terms with each one. However, a word of 5 To improve turnover, the writer suggests companies
warning! Companies should be careful of cutting costs a increase sales to their best customers.
at the expense of quality. Using a cheaper supplier is the b consider limiting the product line.
quickest way to disaster if the quality is affected. c offer premium versions of new products.
A reassessment of any finance deals and loans is also wise d market products to new customers.
because cheaper deals may have become available.
Cost-cutting ideas are not the only way to improve profits, 6 According to the article, employees
and increasing turnover and sales is vital. This can be done a prefer to work in smaller companies.
by re-evaluating the product or service and discovering new b are happier in larger organisations.
ways of getting the most out of existing sales. For example, c are always distant from management.
could a premium version of those products be added or the d are extremely important to success.
product range extended? Another way to increase turnover
is to focus on selling more to your most loyal customers. 7 To ensure a successful future, companies should
Knowing your customer base well and having a good a employ as many staff as possible.
rapport with them is very important. Finally, companies b only employ the most skilled staff.
should try to remember their most valuable asset. c provide a motivating environment.
Employees are often forgotten in the everyday operations d set more challenging goals for staff.
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of a business, especially in larger companies. Smaller
Writing
BULATS Part 2
8 You work for an international retail company
which has stores worldwide. You have been
asked to write an executive summary of the
annual report.
Write about:
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