Chapter 10: Internal Trade

Itinerant soldiers do not have a fixed place for conducting business, they are always on the move, from one street to another, selling their goods. Here are some reasons:

1. Consumers seem to be more comfortable getting service from traders who are small.

2. The retailers deal with products such as fruits and vegetables, the value of which does not fall immediately

3. The retailer provides more attention to the customer and provides doorstep services.

4. Prices offered by itinerant traders are less compared to large-scale retailers as they do not have any provision of storage, so there is no need to spend on storage.

5. Itinerant traders are available at short notice as they keep moving, while large-scale retailers need to stick to a certain area as they have a fixed business setup.

6. Itinerant traders have a low probability of loss as compared to large-scale retailers, as they do not keep an inventory.

Departmental stores are large establishments which look towards fulfilling all needs of customers under one roof. There are separate departments inside the store, each dealing with a different product like groceries, furniture, medicines and electronics etc.

The following are characteristics of departmental stores:

1. A departmental store provides facilities such as restrooms, restaurants, grocery shops, etc., and in this way, looks to provide great service to customers.

2. Stores are centrally located to attract a large number of customers.

3. A departmental store performs the dual role of a retail store as well as a warehouse. All purchases are directly done by manufacturers.

Chain stores are networks of retail shops that are owned by manufacturers or their intermediaries. In such an arrangement, similar-looking shops are established in multiple localities across the city, whereas departmental stores are established in a central location of the city. These shops deal with branded consumer durable products and have identical-looking displays with matching merchandising strategies.

Consumer cooperative stores are formed, managed and controlled by consumers, and their aim is to make goods available at low prices to members of society. The best part about consumer co-operative is that the middlemen are eliminated. The motive is not to profit-making; hence, the price of goods is lower than the price of goods available at retail shops. The capital investment is also less as compared to large-scale enterprises.

The following are the advantages of a cooperative store:

1. A co-operative can be easily formed by an association of 10 people and get registered by completing the required formalities.

2. The liability of members is restricted to the amount of capital contributed by them.

3. Members of the cooperative have one vote to choose their representative.

4. There is no involvement of middleman in the chain, which helps keep the price under check

Retail shops serve as the final step in the distribution channel. It acts as a link between manufacturers and wholesalers by buying goods from manufacturers and selling them to consumers. They are important because of the following reasons:

1. Retailers acts as an information source for new products, their price and features for customers. Customers use this information to decide on products that can be bought.

2. Customers get a wide variety of choices of goods in a retail shop.

3. Retail shops are conveniently located near residential places that help customers get easy access to goods.

4. Retailers offer extra facilities such as goods on credit to regular customers

5. Retail stores ensure the availability of products in a timely manner, thus keeping customers happy.

Mail houses are retail outlets that specialise in selling merchandise through the mail. In this system, there is no direct contact between the buyer and seller. The mail houses use advertisements in papers, magazines etc., to attract potential customers. The details of the product, such as price, features and mode of payment, are mentioned in the advertisement. Once the order is received, the items are prepared as per specification.

The usefulness of mail orders is

1. It can be started with low capital.

2. There are no middlemen, so it saves money for both buyers and sellers.

3. As goods are sent using postal services, reach is more.

4. Goods get delivered to customers at the doorstep.

Products managed by mail houses are

1. Goods that are easy to transport at a low cost.

2. Goods that are available in large quantities.

3. Goods which can be described by pictures.

4. Goods that are graded and stand.

5. Goods which are available throughout the year.

Chapter 10 of NCERT Class 11 Solutions Business Studies covers the concepts listed below –

• Internal trade
• Types of internal trade
• Classification of retailers
• Types of retail trade
• Itinerants
• Types of itinerants
• Fixed retailers
• Large scale retailers
• Departmental stores
• Multiple shops
• Mail order retailing
• Consumer co-operative store
• Supermarkets
• Vending machines
• Role of Commerce and industry

Class 11 Business Studies of NCERT Solutions Chapter 10 provide a broad range of illustrative examples, which help the students to comprehend and learn quickly. The above-mentioned are the illustrations for the Class 11 CBSE syllabus. For more solutions and study materials of the NCERT Solutions Class 11 Business Studies, visit BYJU’S website or download the app for the best learning experience.