Trade
Trade
The process of exchanging the ownership of goods and services on a
particular consideration between the buyer and seller can be interpreted as
trade.
The types of trade
Home Trade
Trade within the boundaries of a particular country is known as home trade.
The types of home trade are
Whole sale trade
Retail trade
Foreign Trade
The trade affairs created by a particular country with one or many other countries is
known as foreign trade.
The types of foreign trade are as follows
Import trade
Export trad
Methods of distributing consumer goods
Direct distribution
The manufacturer distributes his products directly to the consumer.
Indirect distribution
Intermediaries are involved in the process of distribution.
Intermediaries
Intermediaries are the parties who are involved in the process of distributing products from the manufacturer to the
consumer.
The following parties can be introduced as intermediaries
Wholesale seller
Retailer
Agent
Wholesaler
Those who are involved in selling goods for re-sale are known as whole salers.
Retailer
Those who sell goods and services to the end costumer are known as retailers.
Agent
A person who is involved in any activity on the authority of a head is known as an agent.
The agent undertakes responsibilities on behalf of his head. He gains a commission for his
service.
Agents can be categorised according to the services rendered by them in the following
way.
Commission Agent
The commission agent is the one who purchases or sell on his personal desire on behalf of his master (head) for his head’s benefit and
earns a reasonable amount as commission.
Broker
A broker is the person who facilitates a transaction between a buyer and a seller by providing necessary information to one a nother in
order to conclude the transaction through a contract by receiving a broker fee from the buyer or seller or sometimes from bot h the
parties for his service
Del credere Agent
The agent who buys or sells goods under his personal name on behalf of the head is called del credere agent.
Factor Agent
The agent who sells goods on credit and is responsible for the collection of debts from the relevant parties is a factor agent. In
addition to the commission he is also entitled to a factor fee.
Auctioneer
As auctioneer is the agent who arranges the sales of the head’s goods for the public to the highest bidder. He is entitled to an auction
fee for his service
Advantages and disadvantages of getting intermediaries involved
in trade
Advantages
Accumulating different types of goods from different manufactures or suppliers in a convenient location and making
them available for consumers when necessary.
Introducing new goods and services being convenient.
Ability of obtaining market information easily through relevant parties.
The process of exchange will be simple
Disadvantages
The possibility of unnecessary shortage of an essential good in the market.
The possibility of the prices of goods being increased
Retail Trade
Selling goods for the end consumer is known as the retail trade.
Retailer
The person who sells goods in that manner is known as the retailer.
Characteristics of retail trade
Selling goods and services for end consumption
Presenting a miscellaneous set of goods for sale.
Facilitating the end consumer to buy the required goods, in adequate quantities, where it is necessary.
Most probably credit sales may take place.
Maintain a close relationship with the end consumer
Services rendered by the retailers
To the producer
Introducing the new products of the producer to the consumer.
Assisting in the promotion of the manufactured products by displaying banners, posters, distribution of samples
etc.
Provide after – sale consumer feedback about the product to the producer
To the wholesaler
Distribution of goods stored by the wholesaler to the consumer.
Provide information on the market, consumer taste.
Contributing to the promotion of wholesale activities.
To the consumer
Provision of the required goods in adequate quantities when necessary.
Make credit sales.
Introducing new products and providing instructions when necessary.
Providing various types of goods based on customer requirements.
Providing various facilities to the consumer (E.g. : transport facilities , electronic payment methods )
Trends in retail trade
Spreading of supermarkets throughout the country.
Spreading of super markets that were limited to urban areas in the past are now in rural areas at present.
Functioning of retail outlets using modern technology.
Examples :
Recording of prices using barcode
Digital flashes of prices
Using digital scales in weighting/ measuring
Use debit/ credit cards in making payments.
Application of CCTV camera systems in supervision
Extending opening hours.
Example :
Ability to carry out transactions till late at night and at any time on holidays.
Combining retail outlets with the supply of services.
Examples :
Laugfs fuel stations and supermarkets.
Commercial mini bank and cargills supermarkets.
Non store retailing
This is where the consumer is able to purchase goods without visiting a retail outlet by placing orders
through the telephone, fax, and internet and with the aid of catalogues.
There are two methods:
1. Online retailing - The electronic retail trade that takes place through the internet.
2. Direct marketing - Products being supplied to the consumer without the aid of intermediaries.
E.g :
Direct mail
Catalogue
Through the telephone and the TV
Automatic vending machines
For sweets, chocolate, soft drinks
Using of modern management techniques
Wholesale Trade
Wholesale trade can be defined as the sale of goods to the purchasers who purchase with the intension of resale.
Wholesaler
The party involved in wholesale trade is the wholesalerWholesalewholesaler.
Characteristics of wholesale trade
Purchasing of goods with the purpose of resale.
Selling goods in lots/batches
Providing trade discounts
Storage of goods in large quantities
Conduct of sales promotion activities
Carrying out marker researches
Providing transport services when distributing goods in bulk.
Service rendered by the wholesaler
To the producer
Purchasing the products of the producer in bulk/lots/batches
Providing information about the market
Providing various services to the producer
E.g.: Financial facilities, obtaining raw materials
To the retailer
Supplying goods in bulk/lots/batches
Transporting goods to the retail trade centre it self
Providing loan facilities
Engage in storing out, mixing up and packaging of goods
Foreign Trade
The trade that is carried out by one country with another country/countries is foreign trade.
Factors that provide the basis for foreign trade
The inequality distribution of natural resources
Relative cost advantage
Retaining a legal monopoly in some countries with regard to some products
Goods promotion
Trade barriers being minimised
The inequality distribution of natural resources
Because some countries have been endowed particular natural resources significantly the products associated with those resources can be produced only by those
countries themselves.
E.g : Middle East _ Crude oil
South Africa _ Gold
Sri Lanka _ Tea
Relative cost advantage
If a particular country is able to manufacture a product at a low cost relatively to import then it must be manufactured by them in order to export and
where a product can be imported at a low cost relatively to manufacturing, such products must be imported.
E.g : Sri Lanka – Garment industry
Retaining a legal monopoly in some countries with regard to some products.
Patents and Copyrights
The required competency and technology for some products being unavailable in every country or limited to some countries.
E.g : Robotic technology
M otor vehicle technology
Goods promotion
Using various sales promotion strategies to gain a worldwide market for one’s own products.
Trade barriers being minimised
The removal of many sanctions/embargoes, that exist as tariff and no-tariff barriers to trade.
Types of foreign trade
There are several types of foreign trade.
Import trade
Export trade
Re-exports
Entrepot trade
Import Trade
Buying goods and services by a particular country from another country/countries is called import trade.
E.g : Purchasing of motor vehicles from Japan by Sri Lanka.
Export Trde
Selling goods or services manufactured in a particular country to another country/ countries is called export trade.
E.g : Shipping of tea from Sri Lanka to Iraq.
Re-export trade
Re-export tradeis where goods imported from one country being exported to another country in its original form or having been subjected to many changes. Here,
any tariff paid at the point of import can be reimbursed.
E.g : Where cloth and other accessories are imported and finished garments being exported to another country.
Entrepot Trade
Where goods are imported from another country and kept in a warehouse at the point of entry without being brought into the country and re-exported to another
country with or without any changes to the goods is called entrepot trade. As this transaction takes place within the port premises itself tariffs are inapplicable.
E.g : Sri Lanka imports tea from India and exports to Iran.
Benefits of foreign trade
Ability to export the surplus of production
Ability to import products that cannot be manufactured locally
Ability to earn foreign exchange
Ability to obtain economic gains
As a result of foreign trade, products are manufactured not only for the local market but for the global market as well. When
goods are manufactured to meet the demands of a wide market, it becomes a large scale production resulting in economic
gains.
International trade relations and international co-operation being enhanced and strengthened.
New technological and management skills being upgraded.
Becoming a support for economic development
E.g : Employment opportunities, Upliftment of living standards of the people, Obtaining maximum benefits of resources
Free Trade
Free trade is having the necessary space for various parties to engage in the import and export of goods without any
barriers.
Barriers of free trade
The barriers to free trade are categorized as
Tariff barriers
Non-tariff barriers.
Tarrif barriers
In the trade between countries, the imposition of tariff is a barrier to free trade.
Non tariff barriers
Barriers other than the imposition of tariff, to free trade are known as non-tariff barriers.
E.g : Limiting imports – quotas
Limiting exports – quotas
The prohibition of imports/exports
Trade agreements
Stringent exchange policies
Most probably the import and export business transactions take place through the involvement
of an agent.
However, there are instances that the orders are placed directly and the transactions are made.
Whichever method is used, there is no difference in the documentation required in the
import/export procedure.
Import Procedure
Selection of foreign suppliers
Submitting a price inquiry
Receiving a quotation
Obtaining import license
Issuing an Indent
Making arrangements with regard to the payment to the exporter
Clearing of the goods
Selection of foreign suppliers
Selecting a suitable foreign supplier through a study of information available in the Chamber of
Commerce magazines and publications, embassy offices, trade exhibitions, web sites etc.
Submitting a price inquiry
Having selected a suitable supplier, the prices of the goods to be imported are inquired. For this
purpose, the selected supplier will be requested for a price list.
Receiving a quotation
The supplier (exporter) will submit a quotation that includes the prices at which he is willing to
supply the goods, and other terms and conditions, to the importer with response to the price inquir.
Obtaining import license
When certain products are imported, it is necessary to obtain an import license. This is issued by the
Import and Export Control Department. The products for which the import licenses are required is
decided by the Commissioner of Import and Export.
Issuing an Indent
If the importer is in agreement with the quotation he has received, he should submit a purchase order.
This purchase order is also known as an Indent.
Making arrangements with regard to the payment to the exporter.
Most probably Letter of Credit and Credit cards are used for making payment to the exporter.
Clearing of the goods
After the relevant payment is made, the goods can be cleared by producing the relevant documents.
Export Procedure
Getting registered as an exporter.
Finding a foreign purchaser
Obtaining an export license if necessary.
Responding to the price inquiry received from the importer by submitting a quotation.
Obtaining the indent from the importer.
Reservation of shipping space and preparing the necessary documents.
Packing the goods in an appropriate manner for shipping
Insuring the batch of goods to be exported.
Obtaining the bill of lading once the goods have been handed over to the shipping agent.
Making necessary arrangements for the receipt of the consideration.
Documents used in export/import
Trade
Import/export license
Indent/Order
Bill of Lading (B/L)
Invoice
Letter of origin
Letter of Credit (L/C)
Import entry
Export Entrt
Insurance certificate
Wharfinger’s Receipt
Letter of indemnity
Sanitary Certificate/Health Certificate
Warehouse certificate
Import/Export License
The products for which a license is required in import/export trade are announced (published) by the
Export and Import Controller. Some of the institutions involved for this as follows
Examples : Tea – Sri Lanka Tea Board
Gem and Jewelry – State Gem and Jewelry Authority
Vegetables, spice and betel – Department of import and export control
Indent/Order
If the importer is in agreement with the quotation provided by the exporter and willing to purchase
the goods from him, an order should be placed with the relevant supplier (exporter).
This order is known as an Indent. Placing of this order can be done through the internet.
This indent which is sent to the foreign supplier by the importer contains the details of the goods
required, price, relevant shipping conditions etc.
Bill of Lading (B/L)
This is issued to the exporter by the ship-owner or his agent on behalf of a shipping company.
This confirms that the goods relevant have been received by the ship and that the shipping company is responsible
to transport the said goods to the relevant port of destination and hand over appropriately.
A copy of the Bill of Lading is sent to the importer by the exporter and this becomes an essential document for the
importer to confirm that he is the rightful owner of the goods when the ship reaches to the port of destination.
This contains details such as a description of the goods, exporter’s name, importer’s name, the name of the ship
and the port of discharge etc.
Invoice
This is a document which contains details of goods that are being exported.
It includes details of goods, pricing details, conditions of payments, shipping route, terms for rejection of the goods
etc.
Letter of Origin
This is a document which is issued by a recognized board of trading, or any other state authority, certifying that the goods handed
over for shipping have been manufactured in the exporting country.
This document is very important for claiming tariff commission.
Example : when Sri Lanka exports goods to the European Union the letter of origin is issued by the Board of Investment or the Ministry of Industries
Letter of Credit (L/C)
In the Import/Export trade, very often this method is used to settle the payment to the exporter.
The letter of credit is issued by the importers bank to the exporter’s bank on behalf of the importer on his request.
This is a confirmatory document issued by the importer’s bank stating that payment for the goods shipped by the exporter will be
made definitely.
Import entry
This is the document that must be submitted to the Customs by the importer or his agent confirming the importer’s ownership to the
goods that have been received at the port of destination.
This is prepared using the Bill of Lading or Invoice.
Export entry
This is the document submitted to the Customs of the exporter’s country by the exporter giving
full details of the goods that are anticipated to be exported.
Insurance certificate
This is the certificate of insurance obtained by the exporter or importer when exporting the
relevant batch of goods.
This certificate will be obtained by the importer or exPorter based on the terms of the sales
agreement
Wharfinger’s Receipt
This is the document issued to the exporter by the Customs confirming that the goods were
received and undertaken by them.
Letter of Indemnity
This is the document issued to the Ship’s Captain by the exporter to obtain a pure Bill of lading
confirming that the exporter accepts full responsibility for any risk for breakages or damages or any
future risk to the consignment or any part thereof in a situation where the ship’s captain may consider
to issue an impure Bill of Lading.
A pure Bill of Lading is issued when the goods loaded to the ship are in a good condition.
If all the goods or any part of the goods loaded to the ship are broken or damaged, an impure Bill of
Lading will be issued.
Sanitary Certificate/Health Certificate
Depending on the requirements of the importing country, some agro products of the exporting country
may require a certificate from an accepted authority to confirm the suitability of the product for
consumption.
Example : For agro products – Agriculture Department
For fisheries product – Ministry of Fisheries and Aquatic Resources
Warehouse Certificate
The storage in close proximity to the port is known as Warehouse. A warehouse certificate is
issued by the warehouse authority to the importer to confirm that the goods have been stored
there.
While the goods are in the warehouse they may be transferred to another party by transferring
the ownership of the Warehouse Certificate.
Therefore, the Warehouse Certificate is a transferable document
Methods used to settle the payments
in foreign trade
Through opening of letter of credit
Through bank order
Electronic payment methods
Internet prepaid cards
Internet banking facilities
Payment through Electronic Payment entities
• Through opening Letter of Credit
In the Import/Export trade, very often this method is used to settle the payment to the
exporter. The letter of credit is issued by the importers bank to the exporter’s bank on
behalf of the importer on his request. This is a confirmatory document issued by the
importer’s bank stating that payment for the goods shipped by the exporter will be made
definitely.
• Through Bank Order
This is the statement of order given to the bank of the receiver of the money or to the
agent bank of the receiver by the bank of the sender stating to pay the mentioned money
to the mentioned recipient according to the given conditions.
This can be used for fireign trade payment as well as for home parment
• Electronic payment methods
This includes the modern techniques of settling payments using internet facilities.
Examples : Credit cards
This is the most frequent method used to make payments. Visa, master, American Express
are some types of cards that can be obtained from the banks and are used as a payment
method through the internet,
• Internet prepaid cards
Internet pre-paid cards can be used on a temporary basis by depositing a sum of moneyto
be used for a particular purpose.
Internet banking facilities
Payments are made through one’s own bank account and required directions are provided with internet
banking. Most of the banks at present facilitate their accounts holders in this manner. Those who are in
need of this service can get registered and access the relevant website using the user name and the
password..
Payment through Electronic Payment entities
Without making direct payments to the institute from where particular product was purchased the
relevant payment is made through a recognized payment making institute in this method.
Example : www.paypal.com
Before making payments in this manner it is necessary to register with the PayPal portal and provide with
information about the bank account and credit cards. In this manner external parties do not have access
to the credit card information.
Free Trade zone
A free trade zone in which few countries work together with co-operation in accordanceto a treaty
in connection with tariff, duties and trade is known as a trade block.
Trade Blocks
Trade blocks are also known as free trade zones, trade associations and trade partnerships
Free Trade Zones
Some examples for trade zones are as follows :
European union (EU)
Association of South East Asian Nations (ASEAN)
Group of 8 (G8)
European Union (EU)
This consists of 26 European countries. The origin of this was the European Economic
community established on the treaty of Rome signed by 6 European countries in 1957.
While its members maintain a common trade policy, agriculture and fisheries policy, zonal
development policy, it also has introduced a common currency unit called Euro in 1999.
EU member countries;
Austria
Latvia
Czech republic
Poland
Italy
Slovenia
Malta
Finland
Romania
France
Sweden
Germany
Belgium
Greece
Denmark
Hungary
Lithuania
Cyprus
Netherland
Iceland
Slovakia
Luxembourg
Bulgaria
Portugal
Estonia
Spain
Association of South East Asian Nations (ASEAN)
This is a society of 10 South East Asian countries which was established for Political and
Economic co – operation. ASEAN was proceeded by an organisation formed in 1961 called
the Association of South East Asia (ASA), a group of countries consisting of Philippines,
Malaysia and Thailand. These three countries joined with Indonesia and Singapore and
ASEAN
was established in 1967.
The ASEAN member countries are
Philippines
Indonesia
Vietnam
Cambodia
Malaysia
Singapore
Laos
Thailand
Brunei
Myanmar
Group of 8 (G8)
This is an International organisation founded by 8 main stream countries in the world.
The oil crisis in 1973 and the global economic recession were the reasons for the origin of this organisation in 1974.
Amalgamated with United States of America (USA), West Germany, Japan and France unofficially with three other countries
was the origin of this organisation.
Once Russia joined the group in 1997 this was officially named as the Group of 8 (G8).
G8 member countries are:
United states of America
West Germany
Canada
United Kingdom
Italy
Russia
France
Japan
Trade Agreement
An agreement created between two or more countries for the trade and exchange of goods
during a specific period is known as a trade agreement.
An agreement between two countries is known as a Bi – lateral agreement
An agreement between three or more countries is called as a multilateral agreement.
Some examples of trade agreements are given below
North American Free Trade Agreement (NAFTA)
South Asian Free Trade Agreement (SAFTA )
Asia Pacific Trade Agreement (APTA)
North American Free Trade Agreement (NAFTA)
This is an agreement in which of the USA, Canada and Mexico partnered and which was
commenced on the 1st of January 1994.
Conditions for the abolition of trade barriers among these three countries, removal of tariffs,
Exchange of labour are included in this agreement.
A specific characteristics of this agreement is that it will be limited to the goods manufactured
within these countries only.
When the goods manufactured outside these three countries are exchanged among them and
tariffs are applicable. Goods will be free of tariff only when the terms such as Made in USA,
Made in Canada, and Made in Mexico are stated.
South Asian Free Trade Agreement
(SAFTA)
The agreement which was made with the intention of spreading trade co-
operation within the
SAARC zone, creating a free zone within South Asia and making economic
policies of the SAARC zone countries on line with globalisation.
This agreement was signed at the 12th SAARC summit held in Islamabad in
2004.
With the different states entering into this agreement, they made a collective
agreement to benefit through the removal of tariffs on all imports among the
countries, ports and transport facilities, provision of services with regard to
trading etc.
Asia – Pacific Trade Agreement (APTA)
This agreement commenced as the Bangkok agreement in 1975 and was named as the Asia –
Pacific Trade Agreement (APTA) on the 2nd November 2005. The member countries of this
agreement are Bangladesh, China, India, Laos, Mongolia, Sri Lanka and South Korea.
This is the oldest and preferred trade agreement in the Asia Pacific region.
The objective of this agreement is to expedite the economic development of the member
countries through minimising tariff and barriers as far as possible to import goods and services
rather than importing goods and services from other countries
International Organisations
Organisations that have been established to minimize barriers of tariff, exchange
control regulations, customs rules and regulations that impose restrictions on
foreign trade are known as international organisations.
Some examples for such organisations are given below:
World Trade Organisation (WTO)
South Asian Association for Regional Co-operation (SAARC)
Asian Development Bank (ADB)
International Bank of Reconstruction and development (IBRD )
International Monetary Fund (IMF)
World Trade Organisation (WTO)
This is an international organisation established to ease and monitor the international trade.
Having commenced on the 1st January 1995, this organisation operates globally in connection
with the trade rules and regulations among nations.
The head office of the WTO is located at Geneva in Switzerland.
The main purpose of the WTO is to facilitate discussions among member states for trade
promotion, to look down on trade barriers, and to raise the welfare of the people in the member
counties.
South Asian Association for Reginal Co-operation
(SAARC)
This is an economic and political association of eight South Asian countries. It was established on
December 8th 1985.
The co-operative activities within SAARC is performed across five areas.
Agriculture and rural development.
Tele communication, Science technology and climatology.
Health and population affairs
Transport
Human resource development.
SAARC member countries
Sri Lanka
Bangladesh
Bhutan
India
Nepal
Afghanistan
Asian Development Bank (ADB)
The Asian development Bank commenced its operations on 19th December 1966.
The Headoffice is situated at Manila in Philippines.
Out of 67 member countries at present, 48 are from the Asian region while the rest 19 from the
pacific region.
Its main objective is to promote economic and social development of the member countries.
This bank takes steps to provide loans and grants to its memberI have countries for
implementing poverty eliminating projects.
International Bank for Reconstruction and
Development (IBRD/ World Bank)
The IBRD was commenced on the 27th of December 1945 with the Bretton Wood agreement to re-build
the European economy that was destroyed in the 2nd world war.
This bank is known as the bank which provides loan facilities for the development projects
implemented in developing countries with the purpose of eliminating poverty.
The establishment of sustainable development and elimination of poverty are the main objectivesI
have of the World Bank.
It has been established with the objectives of improving global finance co-operation, ascertaining
financial stability, facilitating for the international trade, widening employment opportunities,
providing for sustainable economic development and reducing poverty.
International Monetary Fund (IMF)
The IMF can be introduced as the international organisation that provides financial andI have
technical assistance as well as observes the balance of payment and exchange ratios.
Its head office is situated at Washington in USA.
It has been established with the objectives of improving global finance co-operation,ascertaining
financial stability, facilitating for the international trade, widening employment opportunities,
sustainable economic development and reducing poverty
Impacts of trade associations, trade
agreements and international organisations
on foreign trade.
Removal of tariff and non-tariff barriers that affect free trade.
Promotion of co-operation among countries.
Gaining stable market for the country’s own products through trade agreements.
Minimise disadvantages of price changes since a stable price is gained.
Ensuring all member countries gaining equal rights.
Promotion of global financial co-operation and confirmation of financial stability.
Expansion of employment opportunities, sustainable development and reduction of
poverty etc..
Trends in Foreign Trade
Spread of foreign trade all over the world through E-commerce.
Establishment of new trade zones and trade partnerships to accelerate the
economic development and to face the economic challenges/ crisis effectively.
To channel a country’s resources towards a diversification of production followed
by an advanced technology instead of being restricted to traditional exports.
Leaning towards foreign trade policies to encourage higher value added products.
Attention being placed currently towards the Sri Lankan export packages.
E-Business
Where a business uses computer networks for all the internal procedures such as production, marketing,
accounting, human resource management affairs etc. besides trade affairs they are known as electronic
businesses. Information technology is used in an electronic business for the activities exchanging of
information and for feedback.
E-Commerce
Electronic commerce is only one part of the electronic businesses. E commerce is the support services
like transportatuon, communication, banking take place through electronic networks.
E-Trade
Conducting of buying and selling of goods and services through computerized information systems
followed by internet is known as electronic trade.
Electronic businesses and electronic commerce can be depict diagrammatically as follows.
Procedure of electronic trade
Meeting of buyers and sellers through the internet.
Organizing of the trade transaction.
Conducting of buying and selling affairs.
Settling the payment relevant to the transaction.
Advantages of E-Trade
The advantages to the businessman
Since more efficient and effective service can be rendered the profits and goodwill being enhanced.
The availability of cost benefits
Examples : Cost related to stock being minimized
Minimizing cost of stationery and communication
Minimizing the cost as a result of less intermediaries
The market being expanded as there are no geographical boundaries
Advantages to the customer
Availability of a broader range for selection of goods.
Ability to place the order quickly and easily
Ability to make transactions throughout the 24 hours
The price level of the production relatively being reduced
Social benefits gained
Upliftment of living conditions of the consumers
Opportunity for consuming modern products
Approach to new markets and employment opportunities
Limitations of electronic commerce
Internet facilities not being available everywhere
Lack of knowledge in consumers about the use of internet
Problems arising in payment systems
Legal restrictions like payment of taxes
Lack of trust electronic systems
Malpractices through computerised networks
Methods in which Electronic trade take
place
B2B
B2C
C2C
G2C
B2G
G2B
C2G
B2B – Business to Business
These are transactions from one business to another
Example : Receiving orders from one business to another through the internet.
B2C – Business to Customer
A business selling some product or service to the customer through the internet. This is also known as
electronic retailing E-retailing.
C2C – Customer to Customer
A customer selling goods or services to another customer through the internet.
Example : Transactions that take place through e-bay
G2C – Government to citizen
Payment for government services and obtaining such services through internet.
Examples : Ability of citizens in the Western Province to renew their motor vehicle licenses with the access of
www.motortraffic.wp.gov.lk
B2G – Business to Government
Business making various payments to government through the internet and providing with services.
Example : Payment with the contribution for Employees Provident Fund.
G2B – Government to Business
Example : SLIPS _ Sri Lanka Inter-banking paying system
C2G – Citizen to Government
Examples : Payment of bills, exam fees, and license fees etc. Application for University entrance
Export Composition
Import Composition
Introduces “trade”
Classifies trade under various types
Describes the various ways in which the distribution process is implemented.
Depicts the various ways of distribution process using a diagram.
Depicts the distribution process of a given product using a diagram.
Introduces trade intermediaries.
Evaluates the role of trade intermediaries.
Categorises agents according to the services provided by them.
States the advantages and disadvantages of employing intermediaries in trade.
Defines ‘’Retail trade’’
Explains the characteristics of retail trade.
Lists out the retail outlets available in your area.
Lists the services rendered by the retailer separately to the producer, wholesaler and the
consumer.
Reveals the trends in retail trade.
Defines “wholesale trade”.
Explains the characteristics of the wholesale trade
Lists out the wholesale trade centres in the are
States separately, the services to the producer and to the retailer rendered by wholesalers
Introduces “foreign trade.
Describes the factors on which foreign trade is based.
Describes the types of foreign trade separately.
Evaluates the benefits of foreign trade.
Defines what “free trade” is.
Categorizes the barriers to free trade as tariff and non-tariff and explain them.
Describes the import and export procedure.
Lists the documentation used in the import/export trade.
Lists the institutions related to the import/export trade.
Tabulates the institutions involved at each stage of the import/export procedure, the documents
used at each stage and their necessity.
Explains the different ways of making payment separately in foreign trade.
Provides examples for trade unions, trade agreements and international organisations that
contribute to foreign trade.
Appreciates the contribution of trade societies (trade zones) to the upliftment of international
trade.
Analyses the impact of trade agreements and international organisations on foreign trade.
Inquires about the trends in foreign trade.
Introduces electronic business and electronic commerce.
Defines “electronic commerce”.
Describes the procedure of electronic trade.
Lists the advantages and disadvantages of electronic trade.
Describes separately how electronic trade takes place.