CBSE Class 11 Business Studies Internal Trade Notes Set A

Download CBSE Class 11 Business Studies Internal Trade Notes Set A in PDF format. All Revision notes for Class 11 Business Studies have been designed as per the latest syllabus and updated chapters given in your textbook for Business Studies in Standard 11. Our teachers have designed these concept notes for the benefit of Grade 11 students. You should use these chapter wise notes for revision on daily basis. These study notes can also be used for learning each chapter and its important and difficult topics or revision just before your exams to help you get better scores in upcoming examinations, You can also use Printable notes for Class 11 Business Studies for faster revision of difficult topics and get higher rank. After reading these notes also refer to MCQ questions for Class 11 Business Studies given our website

Internal Trade Class 11 Business Studies Revision Notes

Class 11 Business Studies students should refer to the following concepts and notes for Internal Trade in standard 11. These exam notes for Grade 11 Business Studies will be very useful for upcoming class tests and examinations and help you to score good marks

Internal Trade Notes Class 11 Business Studies


Internal Trade

Trade refers to the process of buying and selling of goods and services with the objective of earning profit. When trade takes place between the people of the same country then it is termed as internal trade. Infect, buying and selling of goods and services within the geographical boundaries of a nation or country is called internal trade. Internal trade can be  classified into two broad categories.

i) Wholesale trade 

ii) Retail trade

Wholesale trade : Buying and selling of goods and services in large quantities for the purpose of resale or intermediate use is referred to as wholesale trade.

Wholesalers acts as an important link between manufacturers and retailers. They purchase in bulk and sell in small lots to retailers.


1. Wholesalers enable manufacturers to undertake large scale production as they purchase goods in large quantities from them.

2. Wholesaler deals in goods in their own name and bear variety of risks such as the risk of fall in prices, theft, pilferage spoilage, fire etc.

3. Wholesalers provide financial assistance to the manufacturers by making cash payment for the purchased goods.

4. Wholesaler provide various useful information regarding the customer preference, market conditions etc to the manufacturer.

5. Wholesalers help manufacturer in marketing function by purchasing goods from them and selling them to the retailers.

6. Wholesalers provide the storage facilities also as they hold the goods in their warehouses/Godowns.


1. Wholesalers make goods available to the retailers, who make them available to the ultimate customers.2. Wholesalers help retailers in the marketing of the goods by undertaking advertising and other sales promotional activities.

3. Wholesalers help retailers by providing credit facility to them.

4. Wholesalers sell goods to retailers in small quantities and thus retailers do not face the risk of storage, pilferage, reduction in prices etc.

5. Wholesalers do have specialised knowledge and they can help retailers by providing the same to them. They inform the retailers about new products, their uses and quality etc.


Buying of goods in large quantities from the wholesalers and selling them in small quantities to the ultimate consumers is known as retail trade. Retailers serve as an important link between the producers and final consumers in the distribution of products and services.


1. Retailers help manufacturers & wholesalers in the distribution of their goods & services to the ultimate consumers.

2. Retailers help manufacturers & wholesalers in promoting their goods & services.

3. Retailers undertake personal selling efforts and thus, help manufacturers and wholesalers in the process of actualising the sale of the products.

4. Retailers collect and provide market information about the tastes, preferences and attitudes of consumers to the producers.

5. Retailers make manufacturer and wholesaler free from the burden of making individual sales and thus help them to operate on large scale production.


1. Retailers provide goods to consumers according to their requirements.

2. Retailers deals in large varieties of products of different manufacturers and thus they offer wide selection to the consumers.

3. Retailers provide important information about the new products to the consumers.  


4. Retailers also provide after sales services in the form of home delivery, supply of spare parts and attending to the customers.


5. Retailers sometimes provide goods to customers on credit basis also, which increase their level of consumption and standard of living.


6. Retailers ensure regular availability of different goods to customers.


Retail trade can be classified into following two categories on the basis whether or not they have a fixed place of business.


i) Itinerant Retailers


ii) Fixed shop Retailers.


I. Itinerant Retailers : - The retailers who do not have a fixed place of business to operate from are called itinerant retailers. They have to move from one place to another alongwith their goods in search of consumers.
Following are the characteristics of itinerant retailers.

1. They are small traders having limited resources.

2. they generally deals in consumer products of daily use.

3. They emphasize on providing greater customer services.

4. They do not have any fixed place to operate from.




1. Peddler and hawkers : They are small producers who generally deals in non-standardised and low-value product such as fruits, vegetables, toys etc. They carry the products on a bicycle, a hand cart, Cycle rickshaw or on their
heads and move from place to place to sell their products at the doorstep of the customers


2. Market traders : They are the small retailer who open their shops at   different places and sell the goods on fixed days such as every saturday or tuesday. These trader deals in single line of goods such as toys, readymade
garnment crockery etc.


3. Street traders (Pavement Vendors) : These types of retailers are found at places where huge floating population gather such as railway station, bus stand etc and sell consumer items of common use, such as stationery,
newspapers, toys etc. They do not change their place of business frequently


4. Cheap Jacks : They are small retailers who have independent shops of a temporary nature in a business locality. They keep on changing their bussiness from one locality to another but not very frequently. They deal in consumer items such as repair of watches, shoes, buckets etc.


Retailers who maintain permanent establishment to sell their goods are called fixed shop retailers. Following are the main characterstics of fixed shop retailers:
1. As compare to itinerant traders, fixed shop retailers have greater resources.
2. They deals in durable as well as non-durable goods.
3. There are different size groups of fixed shop retailers varying from very small to very large.
4. They provide greater services to the customers such as home delivery, repairs, credit facilities etc.


Fixed shop retailers can be classified into two types
(a) Small shop keepers (b) Large retailers.


It include following

1. General Stores : These shops provide different product required to satisfy the day-to-day needs of the consumers such as stationery items, grocery items etc.

2. Speciality Shops : These shops deal in specific line of products like only in ladies shoes, children garments, men s wear, toys etc. These shops are generally located in a central place where a large number of customers can
be attracted.

3. Street Stall Holders : They are small retailer who are generally found at place having floating populations such as street crossing, main road etc. They deal in cheap variety of goods such as soft drinks cigarettes, toys etc.

4. Second hand goods shop : These shops deal in secondhand or used goods such as books, clothes, furniture, automobile etc. They are generally located at street crossings or in busy streets in the form of a stall or a temporary structure.



Fixed shop large stores include following retailers

1. Departmental Stores :- A Departmental store is a large retail outlet offering a wide variety of products, classified into well defined departments under one roof. It has a number of departments, each specialises in single line of
product such as toiletries, medicines, furnitures, groceries etc within a sotre.


Following are the features of a departmental store :-

i) They are located at a central place so that maximum customers could reach there.

ii) They provide all facilities such as restaurant, travel and information bureau, telephone booth, restrooms etc.

iii) These stores are very large in size and so they are generally formed as a joint stock company managed by a board of directors.

iv) All the purchases in a departmental store are made by the purchase department of the store centrally.

v) A departmental store combines both the functions of retailing as well as warehousing.


Advantages of Departmental Stores.

1. They attract large number of customers as they are located at central places.

2. They provide great convenience to customers as they can purchase number of goods at one place.

3. They provide attractive services to customers like home delivery of goods, credit facilities, restrooms etc.

4. They are able to undertake various promotional activities which help people to know about the products.

5. They are organised at a very large scale and thus, benefits of large-scale operations are available to them.


Limitations of Departmental Store.
1. They operate on large scale which lead to lack of personal attention to the customers.

2. They provide various services to the customers like restrooms, home delivery of goods etc which increases their operating cost and thus the overall price of the goods increases.

3. They are situated at a central place and thus they are not convenient for sudden required goods.

4. They operates on large scale and so the possibility of loss is also large / high.


Chain Stores or Multiple Shops.
Chain store or multiple shop refer to network of retail shops that are owned and operated by same organisation, established in localities spread in different parts of the country e.g. Bata Shoe Co., Mc Donalds etc. Some of the important features of such shops are as follows.

1. They are located in popular localities where maximum customers can approach.

2. The manufacturing or procurement of goods is centralised at the head office from where the goods are despatched to each store or shop.

3. Each chain store is supervised by the Branch manager, who is responsible for its day to day working. He send all the information like sales, cash deposits, requirement of the stock daily to head office.

4. All the branches are controlled by the head office.

5. The prices of goods are fixed and all sales are made on cash basis.


Advantages of Chain Stores.

1. They sell goods on cash basis and thus there are no losses on account of bad debts.

2. They eliminate middlemen in the sale of goods & services as they directly sell the goods & services to the customers.

3. Central procurement or manufacturing enables the organisation to enjoy the economies of scale.

4. The total risk of an organisation is reduced as the losses incurred by one shop may be covered by profits in other shop.

5. The goods not in demand in one locality may be transferred to another locality where they are in demand, which reduces the chances of dead stock.

6. In case a shop is not operating at a profit, then it may be closed or shifted to other locality without affecting the profitability of the organisation as a whole.


Limitations of Chain Stores.

1. Chain stores sell goods produced in their organisation only and so they offer limited choice of goods.

2. Personel managing the chain store have to obey the instructions of the head office. Thus, they do not take their own initiatives to satisfy the customers.

3. If the demand for the goods handled by multiple shop changes, it may leads to heavy losses as large amount of stock remains unsold at the central office.


Mail Order Houses
The retail outlets that sell their goods through mail are referred to as mail order houses. There is no personal contact between the buyers and the sellers in this type of trading. The trader contacts the customer through advertisement in newspaper or magazines, circulars, catalogues and price List is sent to them by post. All the information about product such as price, features, delivery terms, terms of payment etc are described in the advertisement. The customers may be asked to make full payment in advance or goods may be sent by VPP (Value
Payable Post), under which goods are delivered to the customer only when he makes full payment for the same. The goods may be sent through a bank which deliver them to the customer only when he makes full payment.


Advantages of Mail Order Houses :

1. They can be started with low amount of capital as no expenditure on building or other infrastructural facilities are required.

2. They doesn t require the services of middlemen so they are eliminated.

3. They do not extend credit facilities to the customers and thus there are no chances of bad debts.

4. They can serve people wherever postal services are available.

5. They deliver goods at the doorstep of the customer which result in great convenience to the customers in buying the goods.


Limitation of Mail Order houses

1. There is no personal contact between the buyers and the sellers. The buyers are not in a position to examine the products before buying.

2. They rely heavily on advertisement and other promotional activities which increases their cost of product.

3. In mail order selling after sales services are absent.

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Chapter 1 Business Trade and Commerce
CBSE Class 11 Business Studies Nature And Purpose Of Business Notes Set A
CBSE Class 11 Business Studies Nature And Purpose Of Business Notes Set B
Chapter 2 Forms of Business Organisation
CBSE Class 11 Business Studies Forms Of Business Organisation Notes Set A
CBSE Class 11 Business Studies Forms Of Business Organisation Notes Set B
Chapter 3 Private Public and Global Enterprises
CBSE Class 11 Business Studies Public Private And Global Enterprises Notes Set A
CBSE Class 11 Business Studies Public Private And Global Enterprises Notes Set B
Chapter 4 Business Services
CBSE Class 11 Business Studies Business Services Notes Set A
CBSE Class 11 Business Studies Business Services Notes Set B
Chapter 5 Emerging Modes of Business
CBSE Class 11 Business Studies Emerging Modes Of Business Notes Set A
CBSE Class 11 Business Studies Emerging Modes Of Business Notes Set B
Chapter 6 Social Responsibilities of Business and Business Ethics
CBSE Class 11 Business Studies Social Responsibilities Of Business And Business Ethics Notes Set A
CBSE Class 11 Business Studies Social Responsibilities Of Business And Business Ethics Notes Set B
Chapter 8 Sources of Business Finance
CBSE Class 11 Business Studies Sources Of Business Finance Notes Set A
CBSE Class 11 Business Studies Sources Of Business Finance Notes Set B
Chapter 9 MSME and Business Entrepreneurship
CBSE Class 11 Business Studies Small Business Notes Set A
CBSE Class 11 Business Studies Small Business Notes Set B
Chapter 10 Internal Trade
CBSE Class 11 Business Studies Internal Trade Notes Set A
CBSE Class 11 Business Studies Internal Trade Notes Set B
Chapter 11 International Business
CBSE Class 11 Business Studies International Business Notes Set A
CBSE Class 11 Business Studies International Business Notes Set B

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