Internal Trade: Super Markets: Merits and Limitations of Super Markets, Consumer Cooperative Stores: Merits and Limitations of Consumer Cooperative Stores (For CBSE, ICSE, IAS, NET, NRA 2022)

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Super Markets

  • Super Market is another kind of large-scale retail organisation from where we can buy most of our household requirements for a week or a month in one visit. Let us learn about this form of large-scale retailing system in detail.
  • Super Market is a large-scale retail store that sells a wide variety of products like food items, vegetables, fruits, groceries, utensils, clothes, electronic appliances, household goods etc. all under one roof. It is formed with the objective of selling goods of daily necessity to general public at a reasonable price by eliminating the middlemen in the process of distribution. These stores are centrally located and also establish their branches near the residential areas. As compared to departmental stores, supermarkets don՚t offer free home delivery facility, credit facilities etc. You will also not find salespersons to convince the customers to buy the goods.
Super Market

Merits of Super Markets

  • Supermarkets deal with a wide range of goods of daily household needs.
  • It provides standard quality items to the customers. Chances of adulteration and duplication are minimal/almost nil.
  • Due to economies of large-scale purchase and avoidance of middlemen the goods are available at a cheaper price in supermarket.
  • In a supermarket normally, services of salesmen and shop assistants are not available. This reduces the cost of operation.
  • A customer can find goods of different brands at one place. This makes comparison and selection easy. You can take your own time to select items of your choice.

Limitations of Super Markets

  • Supermarkets require large amount of capital to start and run them.
  • Because of insufficient funds, benefits of professional management are not available to the super bazar.
  • Goods are sold to the customers only on cash basis. Credit facility is not available to them.
  • Supermarkets follow the principle of self service. So, the items which require the service of salespersons are normally not dealt by supermarket.

Consumer Cooperative Stores

Consumer Cooperative Store is another form of large-scale retail trade which is owned by the cooperative society. When the consumers of a particular area or group find it difficult to get the items of daily necessity, they usually form a cooperative society and run the retailing business. The consumer cooperative store purchases the goods directly from manufacturers or dealers and make them available at a cheaper price.

Merits of Consumer Cooperative Stores

  • The consumer cooperative stores generally provide the goods at a lower price than the market, because they eliminate the profits of middlemen in the process of distribution.
  • These stores sell the goods on cash basis. So, the risk of bad debts is avoided.
  • These stores are generally located near the residential area for the convenience of the members as well as general public.
  • The profit earned by the consumer cooperative stores are distributed among the members as bonus.

Limitations of Consumer Cooperative Stores

  • The consumer cooperative stores generally suffer from the limitations of inadequate funds because these stores are formed by the people belonging to limited income group.
  • Lack of fund or resources restrict the growth and expansion of business.
  • These stores are managed by the member who may not have sufficient experience in business management. Again, due to limited fund it is also not possible to engage professional managers.

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