BUSINESS Vantage

Reading

SAMPLE TEST 2

Time 1 hour

INSTRUCTIONS TO CANDIDATES
Do not open this question paper until you are told to do so.
Write your name, centre number and candidate number on your answer sheet if they are
not already there.
Read the instructions for each part of the paper carefully.
Answer all the questions.
Read the instructions on the answer sheet.
Mark your answers on the answer sheet. Use a pencil.
You must complete the answer sheet within the time limit.
At the end of the test, hand in both this question paper and your answer sheet.

INFORMATION FOR CANDIDATES

There are 45 questions in this paper.
Each question carries one mark.

PV2 500/2427/9
Copyright © UCLES 2018 Cambridge English Level 1 Certificate in ESOL International (Business English)
PART ONE

Questions 1 – 7

• Look at the statements below and the article about entering into a joint venture on the opposite
page.
• Which section (A, B, C or D) does each statement 1 – 7 refer to?
• For each statement 1 – 7, mark one letter (A, B, C or D) on your answer sheet.
• You will need to use some of these letters more than once.

Example:

0 Both companies have benefited from cooperation.

A B C D
0

1 If companies become increasingly reliant on each other, they should have a contract.

2 The financial worth of a joint venture is developed gradually.

3 It is important to remember that joint venture contracts are not totally secure.

4 A company’s reputation does not guarantee a full order book.

5 Without a proper financial arrangement a joint venture may be ended by one associate.

6 Different types of relationships can affect a company’s ability to stay in business.

7 Several factors contribute to the expense of drawing up a contract.

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 Entering into a joint venture
A Barney Collins, founder of animation studio Apix, pursued a partnership with Tony Fisher, director
of production studio Girodin, when Collins’ TV and film clients trimmed their budgets. Founded
five years ago, Apix made a name for itself with high-quality computer-generated animation,
winning several awards. But Collins struggled to keep his staff busy during quiet periods. For the
last year, he’s had an informal arrangement with Girodin. When one of Apix’s clients requires
design-oriented work, Collins brings in Girodin’s team. And when a Girodin client needs 3D
animation or complex special effects, Apix is the resource they always use.

B Collins and Fisher are now in talks to set up a New York City office together. But sharing a sales
staff and office space means their companies will become more dependent on each other,
increasing the need to formalise their handshake agreement and draw up a contract. ‘In this
economy of budget reductions, it’s important to understand that a handshake should not be taken
lightly; a new business relationship, even a seemingly casual one, is likely to have a considerable
impact on your company’s prospects as a growing concern,’ says Collins.

C Making the terms of the joint venture agreement clear is crucial. ‘With joint ventures, the value is
built over time and it’s important to agree how that value will be shared in case the partnership
breaks down,’ says Apix’s legal expert Neil Scott. ‘It is rare to find a joint venture where both
partners benefit equally over the years. Without agreeing at the beginning how income will be
divided, it is likely that one partner may ultimately feel the need to pull out of the venture – and,
depending on the terms of the contract, may have the ability to do so.’

D A joint venture can be structured as a formal agreement. In this case, the working arrangement is
detailed in a legal document that outlines the duration of the partnership and how partners will get
paid, share expenses, and protect confidential information. The cost of this depends on the level
of negotiation, and type of lawyer used. Keep in mind, however, that any contract can be legally
challenged. Therefore, as an alternative, in situations where real franchise value is expected to
be created over time, Scott recommends setting up a new legal entity.

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PART TWO

Questions 8 – 12

• Read the article below about domain names.

• Choose the best sentence from the opposite page to fill each of the gaps.
• For each gap 8 – 12, mark one letter (A – G) on your answer sheet.
• Do not use any letter more than once.
• There is an example at the beginning, (0).

Domain names
Monica Porter meets a man who invests in website names
In the initial growth years of the internet James Coakes believes it is impossible to overestimate the
Coakes received some shrewd advice from a friend. value to a business of a good domain name. His own
‘He told me the interest was going to be very big,’ he company uses teambuilding.co.uk, as it runs
recalls, ‘and that a lot of businesses would need good teambuilding events for corporate customers. ‘Nearly
domain names for their websites and there would be half our traffic comes to the site by prospective
G
a market in selling these. (0)............ So I bought a clients putting the word “teambuilding” directly into
few likely-sounding names for about £30 each.’ It their internet browser. (10)............ For us it equates
was a good move. Before long, a number of other to half a million pounds worth of revenue each year.’
people had switched on to this upcoming investment
Coakes says, ‘It may be more difficult now than it
area, and by the mid-90s, he says, the best names had
was in the boom years, but you can still pick up for a
all gone.
few pounds a name that will probably at some future
Coakes runs a corporate events company, and point be worth thousands. (11)............ You need to
initially the domain names he bought related to his immerse yourself. Every day I look at domain names,
own industry. Then he acquired other generic keep an eye on the registers and watch for renewal
business names, such as auditing.co.uk and dates. There are many websites for registering,
valeting.co.uk. ‘I bought those some time ago and am buying and selling names and you have to catch out
still holding on to them. As a pair, they have to be someone who has forgotten to renew a good name, or
worth £25,000 now.’ (8)............ He currently owns grab one fast enough from a company which has
around 100 names and sells a few each year via a gone bust.’
domain-name trading website, typically for about
Coakes believes that if he sold all his domain names
£5,000 each.
today, he would make more than £1m. (12)............
‘I’m surprised more people don’t make offers for ‘This market hasn’t yet matured. There are only a
names that are already registered. There are really handful of people trading in it, getting into position
good names available for very reasonable prices. ahead of the main wave.’
Once you own the domain name, it’s an asset and I
believe prices will only ever go up.’ The .com
domain is the most sought-after and valuable, but
good names with that suffix are getting harder to
find, so new ones are constantly cropping up.
(9)............ ‘It’s a bit too trendy,’ he explains.
‘Whereas if your site has a .com suffix, it says
“we’re a serious business”.’

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Example:

A B C D E F G
0

A But as with any other sort of investment, D But he’s in no hurry to do so.
you can’t just wander into it and make
money.
E This is how a lot of people locate
services nowadays.
B Choosing a domain name is a brand-
awareness exercise for these
companies. F One such is .biz but, according to
Coakes, it hasn’t really become popular.

C He estimates he has so far spent a

similar figure on his domain name G He said they’d be worth a lot of money
portfolio, including registration and to the right companies.
annual renewal fees.

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PART THREE

Questions 13 – 18

• Read the article below about the process of benchmarking to improve company performance and
the questions on the opposite page.
• For each question 13 – 18, mark one letter (A, B, C or D) on your answer sheet for the answer you
choose.

Benchmarking at Darringtons
Slava Taran, managing director of speciality chemical company Darringtons,
describes his company’s experiences of benchmarking.

We had been manufacturing for over 60 years From the data, it soon became glaringly obvious
when a few years ago we found ourselves that aspects of the business were in dire need of
facing financial pressure from increasingly innovation, such as our manufacturing operation.
heavy overheads. The management team all And although we were among the best for R&D,
came up with possible solutions as to what we did badly on capital investment in equipment
could be done. But in the end, we agreed we and premises, and also in customer satisfaction,
needed something more concrete to guide us. which we were unaware of. We’d evidently
I first heard about benchmarking when worked in the same way for years without
someone I met at a networking event examining closely whether we were truly effective
mentioned his company had been involved in and competitive.
benchmarking. I got in touch with some
business consultants, who suggested putting As a result of benchmarking analysis, we looked
our company on their Benchmark Index at ways of improving certain areas, but soon
programme. They convinced me that by realised the capital investment needed would be
comparing our performance with those of huge. The alternative was to outsource
similar companies, we’d end up with a useful production of a high percentage of our products,
analysis of our current position. which would cut overheads and capital spending
dramatically. We chose the outsourcing option.
We initially had to make decisions as to which This enabled us to redirect resources so that we
kinds of companies we should be compared could create innovative solutions to suit our
against. Other chemical manufacturers were customers’ needs and market them effectively.
an obvious choice, but we opted to benchmark Outsourcing also resulted in more accurate profit
against several food processing companies. analysis, which led us to make changes to our
That might sound strange, but in fact what we mix of products.
had in common was the business model of
combining ingredients in a production process Looking back over the whole process, there are
to create a finished product. things I would have done differently. I think we
should have implemented benchmarking as soon
We sent out questionnaires to the companies as our problems became apparent, but there was
we wanted to target and emphasised that the a lot of fence-sitting in the early days as people line 67
process could well be of mutual benefit. were hesitant about committing to a process they
Generally, companies were positive. But we had no experience of. But people couldn’t argue
also made sure our partner companies signed with the benefits that the process would
up to an agreement specifying limitations on undoubtedly bring and personally, I was
how the information we’d be sharing could be determined not to waste time. In fact, it turned out
used. Otherwise there’s a danger that the to be the catalyst we needed for major
partner company could use the data to gain operational and cultural change at Darringtons.
competitive advantage. We then sent our
analysis to the partner companies to verify the
facts and figures we’d gathered, and get their
feedback on Darringtons’ operation.

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13 What made Slava Taran decide benchmarking was the best solution for his company?

A the discussion he had with his management colleagues

B the presentation he heard at a networking event
C the fact that his company was making a loss
D the confidence of the consultants he contacted

14 Taran wanted Darringtons to be compared against companies that

A manufactured similar products to Darringtons’.

B had also been through financial difficulties.
C used similar manufacturing methods to Darringtons’.
D represented a broad range of sectors.

15 Taran says that when exchanging information with partner companies, it is important to

A restrict what they can do with the information.

B supply feedback to them on their operations.
C explain how the information will be analysed.
D specify what the mutual benefits will be.

16 What did the benchmarking analysis reveal about Darringtons?

A It had dealt effectively with falling client satisfaction.

B Its manufacturing processes had not improved despite recent innovations.
C Its R&D department compared well with those of other companies.
D It had made poor decisions to invest in other companies.

17 What did Darringtons do after the benchmarking analysis?

A They altered the range of products they offered.

B They invested heavily in up-to-date equipment.
C They consulted customers more as to their needs.
D They outsourced production of all their products.

18 Taran uses the expression ‘fence-sitting’ in line 67 to show that Darringtons had

A worried that benchmarking would indicate some corporate failings.

B been reluctant to come to a decision about introducing benchmarking.
C wanted to come up with an alternative solution to benchmarking.
D made it clear they felt the benchmarking process would be a waste of time.

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PART FOUR

Questions 19 – 33

• Read the article below about a company which has received an award for its HR record.
• Choose the best word or phrase to fill each gap from A, B, C or D on the opposite page.
• For each question 19 – 33, mark one letter (A, B, C or D) on your answer sheet.
• There is an example at the beginning, (0).

Sectec among top 100 employers

C
Sectec, a major player in the Canadian security industry, has (0) ………… that it will appear on the
list of Top 100 Employers for the fourth consecutive year. This is in (19) ………… of the fact that it
offers employees an exceptional work environment. The annual award selects employers on the
(20) ………… of criteria such as physical workplace, professional (21) ………… , health and family
benefits, performance management, and (22) ………… in the community.

In order to be (23) ………… on the Top 100 list, a company is (24) ………… on how its business
strategies and corporate culture offer staff incentives which make working for it a rewarding
experience. Companies within the same industry and region with innovative programmes that attract
and (25) ………… on to valued employees are compared, in order to select those that make a
positive (26) ………… to offer a stimulating work environment. ‘Our employees are very important to
us,’ states Sectec’s HR manager, Susan Innings. ‘We are constantly trying to (27) ………… new
ways to show our appreciation for their hard work and commitment. We are (28) ………… pleased to
have received this award for the fourth year in a row.’

Sectec is a global provider of world-class video surveillance to markets such as education, retail and
government. With sales offices and partnerships around the world, Sectec has (29) ………… itself as
a top company by employing a considerable level of flexibility and forward thinking in the
development of its (30) ………… technology. Sectec’s workplace culture is an (31) ………… of these
business principles, (32) ………… the growth of a workforce that is (33) ………… to the creation of
cutting-edge solutions and to exceptional customer care.

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Example:

0 A promoted B told C announced D informed

A B C D
0

19 A acceptance B recognition C awareness D response

20 A foundation B occurrence C aspect D basis

21 A growth B extension C development D gain

22 A involvement B connection C incorporation D association

23 A laid B placed C located D positioned

24 A valued B controlled C calculated D evaluated

25 A keep B hold C take D stay

26 A effort B aim C point D design

27 A go ahead with B come across C come up with D go into

28 A surely B extremely C properly D absolutely

29 A established B fixed C created D set

30 A core B lead C centre D head

31 A upturn B extension C expansion D increase

32 A advancing B inciting C raising D encouraging

33 A committed B attached C enthusiastic D obliged

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PART FIVE

Questions 34 – 45

• Read the text below about delegating work.

• In most of the lines 34 – 45 there is one extra word. It is either grammatically incorrect or does not
fit in with the meaning of the text. Some lines, however, are correct.
• If a line is correct, write CORRECT on your answer sheet.
• If there is an extra word in the line, write the extra word in CAPITAL LETTERS on your answer
sheet.
• The exercise begins with two examples, (0) and (00).

Examples:
0 C O R R E C T

00 A B O U T

Delegation
0 It is impossible for one chief executive, or even one executive committee, to perform

00 about all the functions and duties necessary for an organisation to operate efficiently.

34 It is therefore necessary to delegate certain areas of work to these subordinates.

35 Without this process of delegation, around the business world would effectively be

36 reduced to a set of individuals who working independently. In fact, delegation is one of

37 the major functions consisting of good management. It frees managers from

38 being involvement in the day-to-day aspects of running a busy department, and it

39 allows them to spend more time on their primary functions of managing, pursuing

40 to objectives and dealing with policy problems. What it does not release them

41 from, however, is responsibility for ensuring that the tasks which they have delegated

42 to others are correctly and efficiently performed. Many managers find that it difficult to

43 delegate. This may be because they feel their subordinates are such inexperienced, or

44 because they themselves feel insecure, or because they fear that they may tend

45 become out of touch with daily events. Yet effective management has depends on

proper delegation and skilled managers recognise this.

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