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Chapter: 11th Commerce : Types of Trade

Internal Trade: Meaning, Features, Types

Buying and selling of goods and services within the boundaries of a nation are called internal trade.

Internal Trade – Meaning

Buying and selling of goods and services within the boundaries of a nation are called internal trade. It takes place between buyers and sellers in the same locality, village, town or city or in different states, but definitely within the same country. Internal trade is also called domestic trade or home trade.


Features of Internal Trade

The following are the features of internal trade

a.        The buying and selling of goods takes place within the boundaries of the same country.

b.        Payment for goods and services is made in the currency of the home country.

c.         It   involves    transactions    between the producers, consumers and the middlemen.

d.        It consists of a distribution network of middlemen and agencies engaged in exchange of goods and services.

e.         In home trade the risk of transportation is very less when compared to the foreign trade.

f.          In home trade the laws prevailing in that country only have to be followed.

g.        The aim of home trade is to provide the goods and services economically.

h.        The goods must be a part of domestic production.

i.          Goods must be purchased from an individual or a firm established within a country.

j.          Goods can be delivered using locally available modes of transport.

k.        It does not involve any custom/import duty, but buyers need to pay the taxes to the Government.

 

Types of Internal Trade

Home trade consists of two main sub- divisions namely

1. Wholesale trade and 2. Retail trade

 

1. Wholesale Trade

“Purchase of goods in bulk from the manufacturers and selling them in smaller quantities to other intermediaries” is known wholesale trade.

 

2. Retail Trade

Retail trade deals with the distribution of goods in small quantities to the consumers.


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11th Commerce : Types of Trade : Internal Trade: Meaning, Features, Types |


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