MP Board Class 11th Business Studies Important Questions Chapter 10 Internal Trade
Internal Trade Important Questions
Internal Trade Objective Type Questions
Question 1.
Choose the correct answer:
Question 1.
It is characteristics of where in one roof goods are sold by making different departments –
(a) Multiple shops
(b) Departmental stores
(c) Wholesale trade
(d) None of these.
Answer:
(b) Departmental stores
Question 2.
Price is same in –
(a) Retail trade
(b) Chain shop
(c) Super bazar
Answer:
(b) Chain shop
Question 3.
Number of goods sold in wholesale trade is –
(a) More
(b) One
(c) Less
(d) None of these
Answer:
(c) Less
Question 4.
Less capital is required in –
(a) Departmental store
(b) Wholesale trade
(c) Production
(d) None’of these.
Answer:
(d) None’of these.
Question 5.
Which is not related to the trade by moving from one place to another –
(a) Hawkers
(b) Street sellers
(c) Pedlars
(d) Street shops.
Answer:
(d) Street shops.
Question 6.
Which do not come in fixed retail sellers –
(a) General store
(b) Departmental store
(c) Hawkers and pedlars
(d) Chain stores.
Answer:
(c) Hawkers and pedlars
Question 7.
Shop where manufacturer also sells the goods –
(a) Chain shops
(b) Departmental shops
(c) Hawkers
(d) Stall shops.
Answer:
(a) Chain shops
Question 8.
In consumer co – operative store goods are sold –
(a) Only in cash
(b) Only credit
(c) Both
(d) Free
Answer:
(a) Only in cash
Question 9.
Payment made in internal trade –
(a) Import duty
(b) Export duty
(c) VAT
(d) None of these
Answer:
(c) VAT
Question 10.
Not an movable sellers –
(a) Hawkers
(b) Street sellers
(c) Mill sellers
(d) Departmental stores
Answer:
(d) Departmental stores
Question 11.
Retail seller sold goods to –
(a) Wholeseller
(b) Consumers
(c) Departmental stores
(d) All of the above
Answer:
(b) Consumers
Question 12.
Not big shops –
(a) Super bazar
(b) Mall
(c) Fair trade shops
(d) Franchisee
Answer:
(c) Fair trade shops
Question 13.
Which is not characteristics of departmental store –
(a) Different departments
(b) Sole trade
(c) Under one roof
(d) Multiple management.
Answer:
(d) Multiple management.
Question 14.
Number of sellers in the automatic vending machine –
(a) One who sell goods
(b) Not even one
(c) One who received goods
(d) Two, one seller and other receiving payment
Answer:
(b) Not even one
Question 15.
Which is not a retail shop –
(a) General stores
(b) Street shops
(c) Old goods shop
(d) Departmental stores.
Answer:
(d) Departmental stores.
Question 16.
Which is not characteristic of wholesaler –
(a) Selling goods on large scale
(b) Direct relation with customers
(c) No focus on shop deco
(d) Trade of limited goods.
Answer:
(b) Direct relation with customers
Question 17.
Which is not big scale retail trader –
(a) Departmental store
(b) Super bazar
(c) Permanent shop
(d) Multiple shops.
Answer:
(c) Permanent shop
Question 18.
Which is not a permanent shop –
(a) General store
(b) Specialized shop
(c) Super bazar
(d) None of these.
Answer:
(c) Super bazar
Question 19.
Where departmental store are famous –
(a) USA and Europe
(b) India
(c) China
(d) Pakistan.
Answer:
(a) USA and Europe
Question 20.
Which is not example of big scale retail shop –
(a) Departmental store
(b) Super bazar
(c) Multiple shop
(d) Mail store.
Answer:
(d) Mail store.
Question 21.
Whidris not retail store selling –
(a) Mail store
(b) Internet shopping
(c) Selling by AVM
(d) Super bazar.
Answer:
(d) Super bazar.
Question 22.
Which is not characteristics of super bazar –
(a) Member of super bazar invest their own capital
(b) This store remains in form of cooperative society
(c) Goods sold on credit in super bazar
(d) Situated at centre of city.
Answer:
(c) Goods sold on credit in super bazar
Question 2.
Fill in the blanks:
- The business which is undertaken in one state is called ……………..
- ……………. is compulsory for cooperative society.
- Retailer is a link between ……………… and ……………..
- Hawker and Peddlers are the part of …………….. business.
- …………….. are shops opened by producers.
- …………….. Activities are done in postal business.
- …………….. there are many buildings and shopping center.
- Mcdonald’s restaurant is a example of ……………..
- All the basic needs are available in ……………..
- Organization of super bazar is based on ……………..
- …………….. Purchased goods from Hawkers and Peddlers.
- After receiving debit note firm issued …………….. as a proof.
Answer:
- Internal trade
- Registration
- Wholesaler, consumers
- Retailer
- Multiple shop
- Correspondence
- Mall
- Franchisee
- Departmental stores
- Department
- Housewife
- Credit note.
Question 3.
Write true or false:
- Wholesaler sells consumer goods.
- Business by post is a example of retail trade.
- The decoration of chain stores are same in everywhere.
- Wholesaler is hot necessary for business.
- Super bazar is a biggest retail institute.
- Wholesaler sales goods to consumer.
- Departmental stores and multiple stores are Complementary to each other.
- Retailer is a link between consumer and wholesaler.
- Chamber of commerce works for the interest of industries and business.
- Chamber of commerce is voluntary organization for industries and business.
- Multiple stores are flourish in all over country.
- Mall offers lowest price of goods.
Answer:
- False
- True
- True
- False
- True
- False
- True
- True
- True
- True
- True
- False.
Question 4.
Match The columns:
Answer:
1. (c)
2. (d)
3. (b)
4. (a)
5. (f)
6. (e).
Question 5.
Give answer in one word / sentence:
Question 1.
Purchase goods from wholesaler and sell to the consumers?
Answer:
Retailer.
Question 2.
Purchase goods from manufacturer and sell it to the retailer?
Answer:
Wholesaler.
Question 3.
Wholesaler reduces risk of whom?
Answer:
Retailers.
Question 4.
Who is middleman between manufacturer and the customer?
Answer:
Wholeseller, retailers.
Question 5.
By which name big business complex is called?
Answer:
Mall.
Question 6.
Different goods sold under one roof?
Answer:
Departmental store.
Question 7.
Institution which makes available goods to their customers at lower rates?
Answer:
Consumer cooperative stores.
Question 8.
Business done within boundary of any country?
Answer:
Internal trade.
Question 9.
Seller who deals from door to door for selling goods?
Answer:
Hawkers.
Question 10.
Machine used for selling and payment?
Answer:
Automatic vending machine.
Question 11.
Lac bangles market is which kind of market?
Answer:
State business.
Question 12.
Currency used in internal trade?
Answer:
Domestic currency.
Question 13.
Market related to daily use product and perishable goods.
Answer:
Local market.
Question 14.
Into how many copies credit note is prepared?
Answer:
Two.
Question 15.
The business done in different states of a country is called by which name?
Answer:
National market.
Internal Trade Very Short Answer Type Questions
Question 1.
Write meaning of wholesale trade?
Answer:
Those traders which purchases goods in large quantities directly from the producers and sell in small quantity to the retailers are called as wholesalers.
Question 2.
Write the meaning of the retailers?
Answer:
Those traders who purchase goods from the wholesalers and sell directly to the customers is called as retailers.
Question 3.
What is departmental store?
Answer:
Departmental store is a big store engaged in the retail trade of wide variety of articles under the same roof.
Question 4.
What do you understand by chain shops?
Answer:
Chain stores are retail organization comprising two or more retail stores, owned and operated by under one management.
Question 5.
What is franchisee?
Answer:
It is an authorization granted by a government or company to an individual or group enabling them to carry out specified commercial activities.
Question 6.
What is super bazar?
Answer:
Super bazar is a place where goods of daily use are available under one roof. The commodities are displayed in shelves and consumers are free to choose the commodities of his need and choice.
Question 7.
What do you mean by itinerant shops or hawkers?
Answer:
These are retailer who do not have a fixed place of business and they move from place to place selling their wares, e.g. utensils, toys, garments, fruits, vegetables etc.
Question 8.
What are chain shops ?
Answer:
Chain store is a group of stores handling similar lines of merchandise with single ownership and centralized location.
Question 9.
Name kinds of goods.
Answer:
Types of Goods are:
- Industrial goods
- Customer goods.
Question 10.
What is called as industrial goods?
Answer:
Those goods whose production is done for production of other goods are called as industrial goods.
Question 11.
Write kinds of industrial goods?
Answer:
Types of Industrial Goods are:
- Raw material
- Semi – finished
- Finished goods.
Question 12.
What are consumer goods?
Answer:
These are those goods which are directly used in the society by the customers.
Question 13.
Write kinds of internal trade?
Answer:
The kinds of internal trades are:
1. Direct selling:
The selling technique where there is direct selling of the goods to consumers and have direct relation among them is called as direct selling.
2. Indirect selling:
Selling done by means of middlemen is called as indirect selling.
Question 14.
Write the meaning of internal trade?
Answer:
When the trading is done within the boundary of the country is called as the internal trade.
Question 15.
What is direct trade?
Answer:
Normally, it is seen that in the trading activities many middlemen also exist. That format of trade where no middlemen exist but the goods are directly sold by the producers to the customers is called as direct trade.
Question 16.
What is indirect trade?
Answer:
When the goods are sold by the medium of middlemen then it is called as indirect trade. They are:
- Wholesalers
- Retailers.
Question 17.
What is lorry receipt?
Answer:
This is issued by the transport company for giving acceptance to transport the goods from one place to another.
Question 18.
What is railway receipt?
Answer:
This is issued by the railway company for giving acceptance to transport the goods from one place to another.
Question 19.
What is invoice ?
Answer:
The details of goods which is obtained from the seller for credit sale is called as invoice.
Question 20.
What is proforma invoice?
Answer:
It is a confirm purchase order containing the terms and condition on which buyer and seller agree on the product detail and cost. A sale quote is prepared in the form of proforma invoice.
Question 21.
What is debit note?
Answer:
A form or letter issued by seller to advise the amount owed by buyer.
Question 22.
What is business?
Answer:
When any trading activity is done in order to earn profit then it is called as business.
Question 23.
Class business on the basis of geographical location.
Answer:
Class business on the basis of geographical location are:
- Internal trade
- External trade.
Question 24.
What is credit note ?
Answer:
It is a monetary instrument issued by seller that allows a buyer to purchase any item or service on a future date. It is issued by seller.
Question 25.
Classify the internal trade on the basis of different levels.
Answer:
The internal trades on the basis of different levels:
- Local level trade
- State level trade
- National level trade.
Question 26.
Classify the internal trade on the basis of quantity.
Answer:
The internal trades on the basis of quantity are:
- Wholesale trade
- Retail trade.
Question 27.
When the trading from mail or post started?
Answer:
1872 in USA.
Question 28.
Write meaning of mail order business.
Answer:
When the trade is done through the orders which are received through the post and goods are supplied through post then it is called as mail order business.
Question 29.
Define mail order business.
Answer:
According to Canon and Richard:
“Business through post is a trade in which the orders are received through post and goods are supplied through post”.
Question 30.
Define departmental stores.
Answer:
According to James Stephenson:
“Departmental store is a big store engaged in the retail trade of a wide variety of articles under the same roof”.
Question 31.
What do you mean by multiple shop?
Answer:
A multiple shop consists of number of similar shops owned by a single business firm.
Question 32.
Write three objectives of multiple shops.
Answer:
The three objectives of multiple shops are:
- Fair price
- Elimination of middle men
- Absence of bad debts.
Question 33.
Write two names of multiple shops.
Answer:
They are:
- Bata Shoe company
- Delhi cloth mills.
Question 34.
What are super bazars?
Answer:
Supermarket or Super bazar is a place where goods of daily use are available under one roof.
Question 35.
What is called as pin to plane shop?
Answer:
Department stores.
Internal Trade Short Answer Type Questions
Question 1.
What is internal trade?
Answer:
Buying and selling of goods within the geographical units of a country is known as internal trade. Either goods are sold at one place only or at the centre of the place, through the departmental stores, chain shops, super markets, by hawkers or the peddlers.
Question 2.
What is wholesale trade? Write characteristics.
Answer:
The trade in which the trader purchases goods in bulk quantity from manufacturer and producers and sells them to transfer or consumers in small quantity is called wholesale trade.
The characteristics are:
- Require large capitals.
- Goods are purchased in bulk quantity.
- Deals in a particular line of trade.
- Trade is done through samples.
- Goods are sold to the retailers.
Question 3.
Write the function of wholesale trader.
Answer:
The functions of the wholesale trader are as under:
- Collection of the goods.
- Storing of bulk goods at one place.
- Selling of the goods to the retailers.
- Providing the facilities of the transportation.
- To provide the finance facility.
- To take risk and provide advise to the producers and also retailers.
Question 4.
Define retailers. Write its characteristics?
Answer:
According to the Cundiff and Still:
“Retailing consists of those activities involved in selling directly to ultimate consumers.”
The characteristics are:
- Purchasing in a big quantity and selling in a small quantity to the customers.
- Deals in the variety of the goods.
- Requires minimum capital for the start-up.
- Cash and credit both the facility is made available.
- Personal contact the customers.
- Concentration on taste, fashion, customs of the society.
Question 5.
Write the characteristics of fixed shop retail trader.
Answer:
There are such kind of retailers which do not go on door to door for the trading to the customers. The characteristics are:
- They have more resources as compared to the hawkers and peddlers.
- They vary in the form, small to big sizes.
- They deal in the goods which have durability for short and long term.
Question 6.
Write the objective of the facility of storing goods given to the wholesalers?
Answer:
Facility of storing goods given to the wholesalers because when the goods are produced by the manufacturers then they are not required to” be stored in the godowns is the manufacturer but they are transferred to the wholesalers. Hence, storage problem is not there with the manufacturers.
Question 7.
How manufacturer is benefitted by the information provided by the wholesaler?
Answer:
Wholesalers remain in direct touch with the retailers and due to which they give advise to the producers on the different matters. These matters can be related to the choice of the customers, position of the market, competition in the market and also regarding the need of the customers.
Question 8.
Differentiate between one commodity store and specialized commodity store. Can you find them?
Answer:
Yes, they can be recognized by the following examples:
One commodity store:
Bata shoe store, Liberty shoe store, Raymond store, Titan watch.
Specialized store:
Kids readymade centre, Toys centre, etc.
Question 9.
Differentiate between the line trader and low price shoppers?
Answer:
Differences between line trader and low price shoppers:
Question 10.
What services are provided by the retailers to the wholesale traders and the customers?
Answer:
Retailer provides following services to the wholesalers:
- They provide ready market to wholesalers.
- They provide market information to wholesalers.
- They also help them in dealing of large goods.
- They also take the business risk and help to the wholesalers.
- Helps in distribution work of goods.
Retailer provides following services to die customers:
- Regular availability of goods to customers.
- Information of new goods to customers.
- Facility of choose the goods.
- Home delivery facility.
- Selling in small quantity to customers.
Question 11.
What services are provided by the wholesaler to the producers?
Answer:
Following services are provided by the wholesaler to the producers:
- To make arrangement for the selling of produced goods
- To reduce the risk involved in credit sales.
- To maintain the stock in the proper quantity.
- Reduction in the distribution expenses.
Internal Trade Long Answer Type Questions – I
Question 1.
Itinerant traders have been an integral part of internal trade in India. Analyses the reasons for their survival in spite of competition from large scale retailers.
Answer:
Itinerant retailers are traders who do not have a fixed place of business to operate from. They keep on moving with their wares from street to street or place to place, in search of customers. Followings are the reasons for their survival in spite of competition from large scale retailers:
1. They are small traders and hence rural customers and consumers from backward areas find themselves more comfortable dealing with them.
2. They normally deal in consumer products of daily use such as toiletry products, fruits and vegetables, etc. demand for which does not fall much with time.
3. The emphasis of such traders is on providing greater customer service by making the products available at the very doorstep of the customers. This makes it convenient for the consumers and helps in the survival of itinerant sellers.
Question 2.
Why are consumer cooperative stores considered to be less expensive? What are its relative advantages over other large scale retailers?
Answer:
A consumer cooperative store is an organizations owned, managed and controlled by consumers themselves. The cooperative stores generally buy in large quantity directly from manufacturers or wholesalers and sell them to the consumers at reasonable prices. Members get products of good quality at cheaper rates since the middlemen are eliminated or reduced.
The major advantages of a consumer cooperative store are as follows:
1. Ease of formation:
It is easy to form a consumer co – operative society. Any 10 people can come together to form association and get themselves registered with the a voluntary Registrar of co – operative Societies by completing certain formalities.
2. Limited liability:
The liability of the members in a co – operative store is limited to the extent of the capital contributed by them. They are not liable personally to pay for the debts of society. In case the liabilities are greater than its assets.
3. Democratic management:
Co – operative societies are democratically managed through management committees which are elected by the members. Each member has one vote. Irrespective or the number of shares held by him/her.
4. Lower prices:
A co – operative store purchases goods directly from the manufacturers or wholesalers and sells them to members and others elimination of middlemen results in lower prices for the consumer goods to the members.
Question 3.
What services are provided by the wholesalers toward retailers?
Answer:
Services Towards Retailers:
1. Provide goods as per need:
Wholesaler supplies goods to retailers as per their needs. Though they have large stock, they sell in small quantities to retailers.
2. Minimization of wastage:
The unsold goods of retailers are often taken back by the wholesalers. Thus, the retailer does not suffer much as he has his own ways of disposing surplus.
3. Increase in sale:
Wholesalers make publicity and advertisement for and on behalf of the retailers. This increases the sale of retailers.
4. Control on market price:
Wholesalers exercise control on market price by releasing goods at the time of high demand, thus increasing the retailers margin.
Question 4.
Explain the usefulness of mail orders houses. What type of products are generally handled by them ? Specify.
Answer:
Advantages of mail order houses:
1. Limited capital requirement:
Mail order business can be started with relatively low amount of capital as it does not require heavy expenditure on building and.other infra structure facilities.
2. Elimination of middlemen:
The biggest advantage of mail order business for consumers is that unnecessary middlemen between the buyers and sellers are
eliminated which results in savings to the buyers as well as to sellers.
3. Absence of bad debt:
Since the mail order houses do not extend credit facilities to the customers, there are no chances of any bad debt on account of non payment by the customers.
4. Wide reach:
This system has a wide reach as a large number of people throughout the country can be served throught mail and die goods can be sent to all the places having postal services.
5. Convenience:
This system is very convenient for the consumers as the goods are delivered at the doorstep of the customers.
Mail order houses usually deals only in the goods that can be:
1. Graded and standardizes.
2. Easily transported at low cost.
3. Have ready demand in the market.
4. Are availabel in large quantity throughout the year.
5. Involve least possible competition in the market.
6. Can be described through pictures etc.
Question 5.
Write limitations of retailers.
Answer:
The limitations are:
1. Higher rates:
A retailer always hikes the prices for obtaining his share of profit. Thus, the consumer pays a high price for each and every product obtained from the retailer.
2. Limited area:
The scope of retail trade is confined to a limited area. Thus, he can cater to the needs of local consumers only.
3. Small profit margin:
As retailers invest small capital, they may not earn large profits. The volume of sales is less and hence profit is also less.
4. Lack of expertise in marketing:
Retailer lacks expertise in marketing and sales methods. So, he satisfies his local customers and is unable to increase his sales.
5. Goods of inferior quality:
Sometimes in order to increase his margin of profit, the retailer keeps goods of inferior quality or in short duplicate goods, but changes price of genuine products. In this way, consumers are exploited and the retailer loses his goodwill.
Question 6.
Write demerits of super market/bazar.
Answer:
Demerits of super bazar are:
- Availability of large space at the heart of the city is a difficult task.
- Large capital is required for keeping variety of goods in bank, land and building, window dressing, etc.
- They are meant for middle or high class people.
- Maintenance and operating cost is more. .
Question 7.
What is Mall? Write its kinds.
Answer:
Any business house which is big in size and have all facilities inside it including Shopping centre, Service centre, Advertisement club and different offices are called as Mall.
Kinds of Mall are:
- Shopping arcade
- Strip mall / retail parks
- Regional mall
- Super regional mall.
Question 8.
Write the merits of hawkers.
Answer:
Merits of hawkers:
- Goods required and used by women and children are available at the door.
- Business can be commenced by investing less capital.
- Consumers valuable time, energy and money is saved from going to market area for purchasing goods of daily use like vegetables, utensils, etc.
- The rejects, remnant and wastes of houses are disposed to the hawkers such as newspapers, old utensils, plastic goods, etc.
Question 9.
Differentiate between super bazar and departmental stores.
Answer:
Differences between super bazar and departmental stores:
Question 10.
Write the difference between departmental store and multiple shop.
Answer:
Difference between departmental store and multipe shop:
Question 11.
What is super market? Write its characteristics.
Answer:
The market where the goods are available of the daily use at the proper price is called as super market. This also reflect like the departmental store. It was started since 1929 in the depression time in USA.
Followings are the characteristics:
- Large scale retail shop.
- Management is same as the department basis.
- As similar to department store they also sell different commodity.
- It does not have any sellers.
- Works on the basis of self service.
Question 12.
Why super market runs on loss?
Answer:
Followings are the reason of the loss in the super markets:
- Lack of proper management.
- Heavy management expenditure.
- Improper purchase policy.
- Less control on the goods.
- Corruption among the employees.
Question 13.
What is mall? Write its characteristics.
Answer:
The shopping complex where different kinds of goods and services are available is called as mall. There are multiple stores/shops/counter situated in it. All are linked to each other so that the customers can reach to them easily. These kinds of shopping malls are already established in big cities like Delhi, Mumbai, Kolkata, Bengaluru, etc. and they are running successfully.
Characteristics of mall:
1. Big size retail shops:
These are such shopping complex in which large numbers of shops are located for the convenience of the customers.
2.Different services:
These malls also not only provide goods but different services are also available.
3. Central location:
They are established at the central location so, they are easily accessible by the customers.
4. Different goods:
Goods are made available for the different age group people.
5. Ownership:
All the shops of the mall not belongs to one person but they belongs to the different persons.
Question 14.
‘Wholesalers should not be eliminated’. Give reason?
Answer:
Wholesalers should not be eliminated because of following reasons:
- They are also helpful for the customers.
- Wholesaler only predicts the future demands.
- Producers cannot find out the tastes of the customers.
- Retails will suffer if wholesaler will be removed.
- They favour the specialization.
- They also provide the credit facility.
Question 15.
Differentiate between Wholesaler and Retailer.
Question 16.
Why wholesalers should be removed? Give reason.
Answer:
Followings are the reasons to remove wholesalers:
1. Encouragement to black marketing:
Many of the wholesalers hoard goods with them with a view that when prices increases then it can sold. It leads to black marketing.
2. Increase in price:
Wholesaler and retailer is the link between producer and the customer. These middlemen add their profit in the price of the goods as due to which prices of goods increases.
3. More remuneration:
The wholesalers do not produce goods and even they do not bring any innovation in the product, but only on die basis of capital they sell and purchase of the commodity which is one of the simple task.
4. Advertisement of harmful goods:
Wholesaler some time gets engaged in the advertisement of the harmful goods as useful goods such as cigarette, gutkha, etc.
Question 17.
Write the characteristics of the departmental store.
Answer:
The departmental stores possesses the following characteristics:
1. Business under one roof:
Various departmental stores are present under one roof and one ownership dealing in a particular line of product
2. Variety of goods:
Departmental stores deal in variety of goods, each department dealing in one line of product For example; electronics, electricals, readymade garments, wood craft, cosmetics, etc.
3. Large capital:
Departmental store is a gigantic structure requiring lots of space for its departments. Thus, large capital is needed for requiring land, building purpose and purchase of goods in bulk.
4. Management:
Each department is separately managed by a manager but the whole departmental store is controlled and governed by a board of directors.
5. Other services:
It also provides certain services like parking facilities, entertainment and refreshment to the customers.
Internal Trade Long Answer Type Questions – II
Question 1.
What is Automatic Vending Machine ? Write its advantage and disadvantage.
Answer:
Automatic Vending Machine:
It is a revolution in terms of direct sales. The consumer has to insert a coin or taken of a specific denomination and the automatic machine disgarges the desired product. Normally, the use of this machine for vending goods can be done of standardized goods which are similar in terms of size, weight and price.
For example, soft drinks, newspapers, chocolates, platform tickets, etc. presently this method is gaining popularity in urban region. The speciality of this system of selling is that no sales¬man is required for any transaction. Automated Teller Machine (ATM) is a similar machine which has brought revolution in banking sector. We all know the benefits of such machines.
Advantages:
- Availability of goods at 24 hours a day.
- No salesman is required.
- Goods identical in every aspect is sold through this machine.
- Operation of machine is simple and easy.
- Helpful for travellers as mostly such machines are installed at railway station.
Disadvantages:
- Cost of maintenance is more.
- Cost of machine is more.
- Similar coins are required which a consumer may not have at the time of need.
- Suitable for specific goods only.
- Functioning depends on electricity or battery. In case of no current or low battery, this machine stops functioning.
Question 2.
Write characteristics of mail order business.
Answer:
The characteristics of the mail order business is as under:
- Goods are sold by the advertisement.
- All the goods are sent by the mail and VPP is applied.
- Customers order through mail for the purchase of goods.
- No importance of the middlemen have in this kind of trade.
- Goods need not be stored for this kind of business.
Question 3.
Is wholesale trade necessary? Give arguments in favour of it
Answer:
Wholesalers should not be eliminated because of following reasons:
- They are also helpful for the customers.
- Wholesaler only predicts the future demands.
- Producers cannot find out the tastes of the customers.
- Retails will suffer if wholesaler will be removed.
- They favour the specialization.
- They also provide the credit facility.
Question 4.
Write the problems of retail trade in India and also suggest to remove these problems?
Answer:
In our country the retailers have been great importance since long time. As per research 70% of the trade of India is done through the retail trade only. But they also have some common problems that they face. They are:
1. Lack of capital:
The main problem of the retail trade is the lack of capital and due to lack of capital. They cannot expand their business.
2. Lack of communication:
India is land of villages. Now also many villages have kutcha roads which acts as hurdle for transportation and even communication for the retail trader.
3. Legal formalities:
Retailers have to obtain license from the government for selling of kerosene, rice, wheat, oil, etc. which is a problem for them.
4. Bad behaviour:
Many officer and employees do not behave properly with the retailers.
5. Lack of modern selling technique:
Many of die retailers do not have the modem selling technique. This lead to less selling of the goods by the retailers.
6. Illiteracy:
Now also many people in our country are illiterate and they live in the villages, so the retailers have to teach them the use of different commodities before selling to them.
Suggestions to remove these problems:
- Government should provide loan facilities for providing funds.
- Development of means of transport and communication.
- Government officers and employees involved in corruption should be punished.
- Legal formalities should be made simple.
- Population should be educated properly.
- Government should make the arrangement of godown for storing the goods.
Question 5.
Explain the different types of small level retailers?
Answer:
Types of small level retailers:
1. Itinerant retailers:
They do not do their trading by the one place but move from one place to another. They are:
- Hawkers
- Peddlers
- Line sellers
- Low priced shops.
2. Fixed shop small retailers:
They have more resources as compared to the itinerant retailers. They are:
- General stores
- Specialized stores
- Stalls of locality
- Old goods shop
- One commodity shop.
Question 6.
Difference between invoice and proforma invoice?
Answer:
Differences between invoice and proforma invoice:
Question 7.
Write the advantages of deparmental stores?
Answer:
Advantages of departmental stores are:
1. Large – scale economies:
Departmental stores enjoy large-scale economics because of bulk purchases from manufacturers.
2. Convenience in advertising:
Free advertising of a department is done by other departments. Thus, interdepartmental advertising saves the firm from spending more on advertising substantially in newspaper, magazines, etc.
3. After sales service:
The quality and quantum of after sales service is loudable in a departmental store. They provide extra facilities like refreshment, entertainment, etc.
4. Central location:
Departmental stores are centrally located. Hence, they are easily accessible.
5. Convenience shopping:
Departmental stores offer convenience in shopping, as all variety of goods are available under one roof.
6. Quality goods:
Departmental stores provide goods of superior quality.
Question 8.
What are the necessary elements required for the success of retailers?
Answer:
Followings are the necessary elements required for the success of retailers:
1. Sufficient capital:
A retailer mist invest and possess sufficient personal capital. It is required for establishment of business, advertisement, expansion plans and for exigencies. Borrowed capital is a burden on the business and extra amount has to be paid back in the form of interest. Hence, borrowing of loans must be avoided.
2. Advertisement:
In todays world of cut throat competition, advertisement is an important tool for the creation of goodwill in the market. A retailer must emphasise on advertisement at local level and abstain from unnecessary expenditure on advertisement.
3. Determination of price:
A retailer must be cautions while determining the price of the commodity. (MRP) Maximum Retail Price is printed on packed goods but for unpacked or ‘open’ goods, reasonable price must be fixed. It must be customer’s ‘pocket friendly’.
4. Location of business:
The success of retailer highly depends on the location of the business promises. It must be centrally located and must be accessible to all.
5. Window dressing:
Nowadays window dressing is an important factor in success of retail trade. Huge amount is spent bn window dressing so that customers are tempted to buy commodities. Goods must be displayed properly. Widow dressing is usually done by jewellery shops, super bazars, readymade garments, shops, etc.
6. Cash and credit sale:
In todays business world, nearly 20 % to 30 % trade is carried, on credit basis. Credit sale is essential for increasing the turnover but a retailer must allow credit sale according to his capacity and only to known customers in order to avoid bad debts.
Question 9.
What are the elements required for the success of wholesale trade?
Answer:
Elements for Success of Wholesale Trade:
1. Sufficient capital:
Sufficient capital is essential for wholesale trade. Without sufficient capital, wholesale trade can’t be started at all. Also he needs sufficient capital to perform other miscellaneous functions like warehousing, grading, packing, advertisment, etc.
2. Knowledge of trade:
The full knowledge of particular goods is necessary. Knowledge about the availability of goods, rules and regulations of trade, etc. are also essential.
3. Knowledge of market:
Wholesaler assembles and collects the goods for selling. So, he must have full knowledge about the market of that particular goods and its demand.
4. Big storage:
Big storage should be there so that goods may be stored for a long time and in large quantity. Morever the storage must be safe.
5. Knowledge of advertisement and sales technique:
He must have proper knowledge about the various media of advertisement. He must have also knowledge of sales technique.
6. Personal quality of the trader:
The wholesaler should be hardworking and devoted person. He should pay proper attention for the development of trade.
Question 10.
Give suggestions to make consumer’s cooperative stores popular.
Answer:
Suggestions to Make Consumer’s Cooperative Stores Popular:
1. There should not be any political interference:
To make consumers cooperative stores popular, it is necessary that there should not be any political interference.
2. Increase of capital:
Sincere effort to be made to increase the capital as without sufficient capital no business can prosper.
3. Appointment of experienced persons:
One of the reasons of failure of cooperative is unexperienced persons. So, in running cooperative stores, help of experienced persons should be taken and they should be appointed.
4. Development of cooperative spirit:
There should be development of cooperative spirit. The number of members should increase and members must remain active.
5. Price of the goods:
Price of the goods in cooperative stores should be less than the market price.