1.1 What is a business? questions for IB Business Management

Tolulope Adeyemi runs Mama Tolu’s, a sole-trader bakery in Lagos, Nigeria. Her bread is sold unwrapped to street traders, who resell it alongside bread from many other bakeries. Tolulope is considering selling her bread in printed bags with the Mama Tolu’s name, logo and a short message: “Baked fresh every morning since 2015”.

Hollenstein Components

Hollenstein Components (HC) has manufactured metal parts for car makers in Kalindor, a country in central Europe, since 1978. It employs 640 people at a factory in Brenholm, a former steel town. HC’s managing director, Jana Kovář, is preparing a five-year plan and has collected the national employment data shown in Table 1.

Table 1: Employment by sector in Kalindor (000s of workers)

Jana has also learned that two car makers that buy from HC plan to move some assembly to lower-cost countries, and that a software company has opened a research centre in Brenholm, recruiting engineers from HC.

Kiri Honey

[1] Aroha Ngata set up Kiri Honey (KH) as a sole trader in 2019 near Gisborne, New Zealand. KH keeps about 400 beehives on land leased from local sheep and cattle farmers. Aroha and two seasonal workers collect mānuka honey each summer and sell it in bulk drums to a large processor in Auckland, which tests, grades, packs and exports it under its own brand.

[2] Starting KH was difficult. Aroha used NZ$60 000 of her savings and a bank loan to buy the hives and a second-hand truck. It took her almost a year to agree access to land with farmers, who worried about bees near their animals. Poor weather in the first two seasons cut honey yields by a third, and a varroa mite infestation killed 60 hives. Large beekeeping companies in the region pay landowners more for the best mānuka sites.

[3] In 2025 the processor reduced the price it pays per kilogram by 20 %, blaming lower export demand. Aroha’s cousin Tama, a cosmetic chemist, has suggested that KH should make its own range of honey and beeswax skincare products, such as lip balm and hand cream, under the Kiri brand. They would be sold online and through gift shops in tourist towns. A small processing unit would cost NZ$180 000, and Tama would join the business to run it.

[4] Aroha is unsure. She enjoys working with the bees and has a young child. She has no experience of marketing, and she knows that the skincare market is crowded with well-known brands. However, she believes that customers are willing to pay high prices for products with a clear story about where they come from.

Puerto Lirio is a coastal town in southern Chile. Its council wants to encourage more people to start businesses in the town and has published the employment data in Table 1. Fishing has declined because of quotas, while tourism has grown since a new airport opened in 2018. A growing number of people now work remotely from Puerto Lirio for software and design companies based in Santiago.

Table 1: Employment by sector in Puerto Lirio

Sabor Andino

[1] Lucía Quispe worked for nine years as a chef in a large hotel in Arequipa, Peru. In 2024 she left her job and bought a second-hand food truck for PEN 45 000, using her savings and a loan from her brother. Her business, Sabor Andino, sells Andean street food with a modern twist, such as quinoa burgers and stuffed rocoto wraps, to students outside a large university.

[2] Lucía had noticed that the cafés near the campus sold mostly expensive sandwiches and that many students skipped lunch. A food truck cost far less than renting a restaurant, and she could move it to markets and festivals at the weekend. After years of working long shifts for someone else, she wanted to decide her own menu and hours.

[3] The first year has been harder than expected. Getting a municipal street-trading permit took four months, during which Lucía earned nothing. The prices of cooking oil and vegetables have risen, and she cannot easily raise her prices because students are price-sensitive. Sales fall sharply during the university holidays. Two established cafés have started offering a cheaper “student lunch”.

[4] Lucía has 3 400 followers on social media, where she posts the truck’s location each day. The city council has announced a new “Healthy Arequipa” programme that will include a monthly street-food festival.

Daan de Vries plans to open Nomad Pedals, a bicycle repair business in Utrecht, the Netherlands. He will rent a small workshop and also run a van that repairs bicycles at customers’ homes and offices. His estimated start-up costs are shown in Table 1. Daan has savings of €12 000 and his parents have agreed to lend him €5 000.

Table 1: Nomad Pedals’ estimated start-up costs