How to score marks for SBQ
Having trouble scoring for the SBQ section? This is one of the easiest places to gain 7 marks but often I see students only getting 4 which is kind of sad. Often students only talk about the information they see but not how it is relevant to the business.
Actually all you need to know is:
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Answering Structure
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How to interpret the financial and non-financial information
Guidelines on HOW to comment:
You MUST show comparisons. Marks are awarded based on WHY a factory is better than another.
Bad Example
Tommy’s cost of sales will be $10 if he buys from supplier A. It will be $12 if he buys from supplier B.
Why is this a poor example? Because the answer is generic. It shows you can read 2 numbers but not tell me the significance. Also, just because you can refer to the 2 sets of numbers doesn't tell me which is the better option.
When in doubt, explaining more beats explaining less.
Good Example
Tommy’s cost of sales will be LOWER by $2 if he buys from supplier A rather than supplier B. Lower cost of sales will lead to higher profits for the business.
[Remember to EXPLAIN the impact of the business. This is the easiest area to lose marks if you do not interpret the data. Don’t forget, you’re taking on the role of an accountant providing financial information to his company.]
Interpreting non-financial information
So while many of you may excel in talking about the numbers, remember to explain potential impact of non-financial information as well.
I will list out some common examples of non-financial information below for your reference.
Local vs Overseas Supplier
Typically local suppliers are the preferred choice because they are easier to get in contact with. If you're looking at an overseas seller, accept the fact that it may be a more risky venture.
E.g You can chase up on a Singaporean supplier much more easily than say a supplier in Malaysia/China.
Reputation of a business
Opt for one that has a longer history of doing business with you or one that is well-known for a specific product. Because trust in quality is a major reason for why customers may decide to buy from you.
E.g You'd rather buy from a supplier like Apple than say an unknown brand like Orange.
Industry Outlook
Industry outlook refers to future growth potential. Like how the technology industry is booming so you'd want to consider investing in something like that for the long term as compared to say...Singpost.
A strong growing demand is a good sign that you can choose it as a factor for your exams.
Customization
Customization is a new trend where customers may opt to pay extra to modify something more to their liking. Think about it in the context of custom painted Air Force 1 shoes or even mechanical keyboard keycaps.
This is a positive option for customers because it will likely drive higher sales due to higher customer satisfaction.
Speed/Stability
So this area is a bit more tricky, but it refers to how your business will less likely be disrupted if your non-current assets can last longer or get replaced faster.
Fewer disruptions means you don't have to have business downtime or spend on costly repairs/rentals to your business can keep running.
These are just some basic tips I hope can help you in your journey to master the scenario based question. If you have any other questions, feel free to drop me an email below. All the best!