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Cambridge IGCSE

BUSINESS STUDIES 0450/21

Paper 2 Case Study October/November 2022
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Safari Adventures (SA)

Tokumbo is a sole trader. He started SA 2 years ago in country X. Tokumbo had previously worked
for a company selling holidays. SA organises safari tours which take tourists to view wild animals
on a game reserve. Most of SA’s customers are tourists from other countries. Tokumbo did not
have any objectives when he started SA but knows they are important for his business.

SA uses its own vehicles for the 7 day safari tours and provides accommodation in small local
hotels. Tokumbo employs 4 safari guides, 1 for each of the 4 vehicles. The safari guides drive the
tourists around the game reserve. There is 1 additional employee who helps Tokumbo in the office
with administration. Tokumbo thinks SA needs a website so tourists can book directly with them
rather than booking through holiday companies that charge SA a fee.

Tokumbo is considering the following three options for the future growth of SA safari tours:

• Option 1 - increasing the number of safari guides and vehicles to increase the number of
customers from the existing target market
• Option 2 – targeting young people who want to camp and sleep in a tent on their safari
• Option 3 - targeting high-income tourists who prefer to stay in luxury hotels

Information about these three options is outlined in Appendix 3.

Tokumbo plans to provide more training for his employees whichever option he chooses. He wants
his existing employees to have a wider knowledge of the wild animals on the game reserve and to
be able to provide high-quality customer service. Tokumbo has to decide which method of training
to use.

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Appendix 1

Newspaper article in Main News, September 2022

Tourism takes off

Country X is becoming a popular holiday destination for tourists from other countries.

There is an increased demand from high-income tourists who want to stay in luxury hotels whilst
on safari tours. These tourists are willing to pay high prices. There is also a new trend for younger
people who want cheaper holidays. They prefer to camp and sleep in tents on game reserves rather
than stay in hotels.

Are the many safari businesses in country X ready to target these new markets?

The use of e-commerce to find and book safari tours by tourists from other countries is offering
both opportunities and threats to businesses in country X.

The inflation rate in country X has increased to 4% which may affect some of our local safari
businesses.

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Appendix 2

Email from Tokumbo’s accountant

To: Tokumbo

From: Accountant

Subject: Source of finance for the new vehicles

New vehicles will be needed whichever option you choose for the future growth of your business.

I have considered several sources of finance you could use for the new vehicles. Interest rates on
bank loans have fallen to 2% whilst interest rates on savings are 3%. I think you should choose
from one of the following sources:

• Leasing
• Bank loan
• Retained profit

We can meet to discuss these sources if that would help you to decide.

Appendix 3

SA’s three options for a 7 day safari tour

Option 1 Option 2 Option 3

More existing safari tours Camping safari tours Luxury safari tours

Forecast number of
16 32 10
tourists per week

Total costs per week for

SA to provide these $12 000 $8000 $20 000
safari tours

Average cost per tourist $750 ? ?

Price per tourist $1000 $400 $2400

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