Business Studies for Class 11 Chapter 10 Internal Trade

Learn CBSE Business Studies Index Terms for Class 11, Chapter 10 Including Definitions and Meanings

1. Internal Trade – Internal trade is defined as buying and selling of products and services within the geographical boundaries of a nation. So the trading that happens within a country’s limit is known as internal trade. In this trading, no import or customs duty is imposed because these goods and services are produced and consumed domestically. Internal trade is categorised into two different sections, a) wholesale trade and b) retail trade.

2. Wholesaler – A wholesaler is a person who operates as a mediator between the distributor and retailer. These people buy a product in a considerable quantity from the distributor or manufacturer at a cheaper rate and resell it to the retailers at a higher price to make profits.

In the supply chain business, wholesalers play an integral part as they buy the product in bulk and then break the bulk into small sections, hold inventory in a warehouse, and deliver the product to the buyers.

3. Wholesale Trade – Wholesale trade is the selling of goods in bulk to retailers and businesses at cheaper rates. The wholesaler buys the products in bulk, breaks them into small parts, repacks them, and sells them to the retailers. The wholesaler sells only specific items and is least interested in the location of the shop, packaging, and display of the goods. They are more interested in the quantity, not the quality of a product.

For wholesale business, considerable investment is required, and not the promotion and advertisement. The customers of the wholesalers are spread in various cities, towns, and different states. Most of the purchases are sold through credit to the customers.

4. Market Traders – Market traders are small retailers who open their shops at different places on fixed days. They are also small traders who sell their goods at different places on fixed days. For example, every Saturday or every Sunday in ‘Saturday market’ and ‘Sunday market’, etc. These traders deal in a single line of goods such as toys, readymade garments, fabrics, etc. They deal in low price, low-quality goods; hence, they cater to the needs of the lower-income group.

In other words, They are small-scale sole proprietors who hold stalls at different locations on specific days, which may be once a week. They deal in a variety of cheap goods which are of customers interest and which are of daily use. Farmer mandis are the best example of this type of itinerant retailer where farmers bring fresh products from the fields and sell them at different places on fixed days.

5. Retailers – When buyers buy a product and sell it to the final customers for their consumption, and not to any supplier or wholesaler, this is known as retail. The retailers are the mediator between wholesalers and customers. They purchase goods from the wholesaler and sell them to the ultimate customers in small quantities. Retailers offer a wide variety of goods and are in direct communication with a large chain of suppliers, giving them an opportunity to manufacture and develop more sustainable goods.

A retailer does not manufacture any product they sell, but they are the final link in the distribution chain and the one who connects and delivers the goods and services directly to the customers.

6. Peddlers and Hawkers – They are the oldest forms of retailers. They deal in non-standardised and low-value goods like fruits, vegetables, ice-creams, toys, fabrics, etc., which they carry on bicycles, handcarts, cycle-rickshaws, or on their head. They are small traders who move from one place to another to sell their products.

7. Street Traders – Street traders are also known as pavement traders. These retailers can be seen in areas having a high population like bus stands, railway stations, etc. They deal in common use products, like newspapers, magazines, toys, stationery items, etc. They don’t change their place of business frequently.

8. Cheap Jacks – Cheap jacks do not stay long at one place of business but differ from hawkers and peddlers in the sense that while the latter do not have shops of their own, cheap jacks do hire small shops in residential localities or use tents to display their wares. They shift from locality to locality according to the prospects of a business. They deal in low-priced household goods.

9. Retail Trade – Retail Trade refers to the sale of goods in small lots to the final consumers. Retailing includes selling goods of different varieties door to door, on television, on the telephone or on the internet, and so on.

10. Speciality Stores – Speciality store shops deal in specific lines of products like shoes, toys, gifts, children’s garments, electronic goods, etc. Such shops are becoming very common, particularly in urban areas. In order to attract a large number of customers, these shops are centrally located.

11. General Stores – General stores deal in a large variety of products required to satisfy the day-to-day requirements of the customers. These are found in local markets and residential areas. These stores remain open for long hours and provide convenience to the consumers in buying goods of daily use such as stationery items, grocery items, toiletries, etc. They also provide credit facilities to their regular customers.

12. Street Stall Holders – Street stall holders are small retailers generally found at places having a heavy flow of population, such as street crossings, main roads, etc. They deal with low-quality goods like toys, hosiery products, etc. They carry out business operations in a very limited space.

13. Second-hand Goods Shop – Second-hand goods shops are retail shops that deal in second-hand or used goods like automobiles, furniture, books, etc. They cater to the needs of people having limited means. The price of the goods sold by them is generally low. Sometimes, these shops deal in antique items or goods having historical value. In such a case, they charge high prices to customers having a special interest in such goods.

14. Single Line Stores – Single line stores deal in a single product line such as watches, shoes, tyres’ readymade garments, books, etc. These stores are centrally located and keep a wide variety of items of the same line.

15. Departmental Stores – Departmental stores are centrally located in the heart of a city. Hence, they cater to a large number of customers. They provide various facilities like telephone booths, restrooms, restaurants, etc., to the customers. Due to the large size, these stores are formed as joint stock ventures managed by the board of directors, consisting of the managing director, general manager, and manager of each department etc. The goods are purchased directly from the manufacturer and are kept in warehouses. These stores perform the functions of both retailing as well as warehousing on the one hand and, on the other hand, help in eliminating middlemen between the manufacturer and customer. In these stores, the purchases are made centrally by the purchasing department while the sales of each department are decentralised.

16. Chain Stores – Chain stores are defined as a type of retail organisation that is composed of more than one retail store owned and operated by a single management company. It is an outlet that is characterised by several locations that share a brand with centralised management along with standard business practices. Chain stores have completely revolutionised the retail market. They have managed to dominate the sector for a long time and continue to do so with their method of making shopping more convenient for the customers.

17. Vending Machines – Vending machines are coin-operated machines and help in selling products like milk, soft drinks, hot beverages, platform tickets, etc. The latest development under this concept is Automated Teller Machines (ATM) in the banking sector. This machine has made it possible to withdraw money at any time without visiting any bank. Vending machines are especially useful for selling prepacked goods at a low price, having high turnover, and are uniform in size and weight.

The main limitation of these machines is that the installation cost of these machines is very high. The expenditure on regular maintenance and repair on them is also very high. Another limitation of this system is that the customers can neither see the product before buying nor return unwanted goods.

18. Super Markets – Supermarkets offer a wide variety of products and discounts to customers. Supermarkets reduce the business of smaller shops. Big supermarkets eliminate the role of wholesale traders. Supermarkets have a huge advantage over smaller shops. Supermarkets are huge structures and thus require more money and resources for their setup as compared to smaller shops.

19. Chambers of Commerce – A chamber of commerce is an affiliation or organisation of money managers intended to advance and safeguard the interests of its members. A chamber of commerce is frequently comprised of a group of entrepreneurs that share a region or interests; however, it can likewise be global in scope. They will choose administration, name agents, and discuss which approaches to uphold and advance.

Chambers of commerce exist from one side of the planet to the other. They don’t play an immediate part in making regulations or guidelines; however, they might be compelling in impacting controllers and officials with their coordinated lobbying efforts.

We hope that the offered Business Studies Index Terms for Class 11 with respect to Chapter 10: Internal Trade, will help you.

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