166 O Level Commerce Notes

Description

166 O Level Commerce Notes

TABLE OF CONTENTS
UNIT 1 PRODUCTION
What is commerce?
11 THE CHAIN OF PRODUCTION
Production
Chain of production
Needs and Wants
Needs
Wants
166 O Level Commerce Notes
12 PRIMARY INDUSTRIES, SECONDARY INDUSTRIES AND TERTIARY ACTIVITIES
Direct Production and Indirect production
Direct production
Primary, Secondary and Tertiary Sector of Production:
Primary production
Secondary production
Tertiary production
How are manufacturing and tertiary activities inter-related?
13 SPECIALIZATION AND DIVISION OF LABOR
Specialization
Forms of Specialization
14 COMMERCE
Trade and Aids to Trade
Types of Trade
Purpose / Importance of Foreign (overseas) trade
Comparison of Home Trade and Foreign Trade
Aids to Trade
15 THE RELATIONSHIP BETWEEN INDUSTRY, COMMERCE AND DIRECT SERVICES
UNIT 2 RETAIL TRADE
21 THE ROLE OF RETAILER IN THE CHAIN OF DISTRIBUTION
The Retail Trade
22 TYPES OF RETAILERS
Small Scale Retailers
Peddlers / Hawkers / Roadside Traders / Mobile Shops / Street Markets
Advantages
Disadvantages
Unit Retailers
Advantages
Disadvantages
Automatic Vending Machines
Advantages
Disadvantages
Specialty shops
Advantages
Disadvantages
LARGE SCALE RETAILERS
Department Store
Advantages of departmental stores
Disadvantages of departmental stores
Multiple Chain Stores / Multiple Shops:
Advantages
Disadvantages
Super market
Advantages of supermarket
Disadvantages of supermarkets
Hyper Market
Advantages of hypermarket
Disadvantages of hypermarkets
23 LARGE SCALE AND SMALL SCALE RETAILING
How do small scale retailers survive against competition from large scale retailers?
24 SELLING TECHNIQUES AND METHODS AND THE IMPLICATIONS OF E-COMMERCE
Branding / Own Brands / Logo
Packaging
Self Service
After Sale Service
Computers as AID to retailing
E-commerce
Why Small Scale Retailers are dependent on wholesalers
25 TRENDS IN RETAILING
Omni-channel (Omni-channel retailing)
Self Service Checkouts
Loyalty Programs
Mobile Retailing: (m-commerce)
UNIT 3 CUSTOMER CREDIT
31 USE OF CREDIT
Reasons for giving Credit / Reasons for increased use of credit
32 TYPES OF CREDIT
Hire Purchase
Extended Credit / Deferred payment:
Store cards
Credit Cards
Informal Credit / Lay-bye
33 SUITABILITY OF DIFFERENT TYPES OF CREDIT
UNIT 4 WHOLESALER
41 THE ROLE OF WHOLESALER IN THE CHAIN OF DISTRIBUTION
Wholesale Trade:
Channel of Distribution
Different Channels of Distribution
Factors affecting choice of Channel of Distributions
42 FUNCTIONS AND SERVICES OF THE WHOLESALER
Cash-and-carry wholesalers
Voluntary chains
Reasons why do wholesalers not operate at retail level
Why the role of wholesaler is on decline
43 INTERMEDIARIES
Middle Man
Agents:
1 Factors
2 Brokers
Special types of Middleman
Why Small Scale Retailers are dependent on wholesalers
UNIT 5 DOCUMENTS OF TRADE
Why are Documents needed?
COMMON FEATURES in all Documents
51 DOCUMENTS OF HOME TRADE
ENQUIRY (Issued by: Buyer, Issued to: Seller)
QUOTATION (Issued by: Seller, Issued to: Buyer)
CATALOGUE (Issued by: Seller, Issued to: Buyer)
PRICE LIST (Issued by: Seller, Issued to: Buyer)
ORDER (Issued by: Buyer, Issued to: Seller)
ADVICE NOTE (Issued by: Seller, Issued to: Buyer)
DELIVERY NOTE (Issued by: Seller, Issued to: Buyer)
INVOICE (Issued by: Seller, Issued to: Buyer)
CREDIT NOTE (Issued by: Seller, Issued to: Buyer)
STATEMENT OF ACCOUNT (Issued by: Seller, Issued to: Buyer)
Differences between Invoice and Statement of Account
Sequence of Documents in Home Trade
52 TERMS OF PAYMENT
Cash discount
Trade discount
Mark-up
UNIT 6 INTERNATIONAL TRADE
International trade
61 THE IMPORTANCE OF INTERNATIONAL TRADE
Types of International/Foreign Trade
Visible and Invisible Trade
Similarities between Home Trade and Foreign Trade
Differences between Home Trade and Foreign Trade
Interdependence of countries
166 O Level Commerce Notes
62 BALANCE OF TRADE AND BALANCE OF PAYMENTS
Balance of Trade
Balance of Payments
(i) The Current Account
(ii) The Capital Account
(iii) The Financial Account
Why deficit in Balance of Payments and Balance of Trade is undesirable
63 CUSTOMS AUTHORITIES
64 FREE TRADE, TRADING BLOCS AND PROTECTIONISM
Free trade:
Trading blocs
Protectionism:
How to protect from imports-to make balance of payment surplus?
Effects of protectionism
65 DIFFICULTIES FACED BY IMPORTERS AND EXPORTERS
Difficulties faced by Exporters:
Exporters and Aids to Trade:
UNIT 7 ADVERTISING
71 THE ROLE OF ADVERTISING
Aims / Purposes of Advertisement
Advantages of advertisement:
Dangers of Advertisement: (Criticism on advertisements) 8
Types of Advertising
72 ADVERTISING MEDIA
Television
Radio
Internet
Cinema
National Newspapers
Local Newspapers
Magazines
Trade Journals:
Trade Fairs / Shows / Exhibition
Leaflets / Flyers / Pamphlets
Packaging / Plastic Bags
Direct mail
Sponsorships
Catalogs / Broachers
Digital Billboard
Transport Vehicles
Point of sale display / Windows display
Neon Lights / Signs
Factors affecting choice of Advertisement Media
73 METHODS OF APPEAL (DEVICES)
Color
Emotion
Ambition
Famous people (celebrities)
Music
Humor
74 SALES PROMOTION
Difference between Advertising and Sales Promotion
Methods of promotion
Displays and demonstrations:
Factors effecting choice of sales promotion method:
75 TRENDS IN ADVERTISING:
Digital Billboards:
Product Placement:
Mobile phone advertisement:
Digital Video Advertisement:
Importance of Internet Advertising:
UNIT 8 COMMUNICATION
81 IMPORTANCE OF COMMUNICATIONS IN TRADE AND THE GLOBAL MARKET
Importance of communication in commerce
82 METHODS OF COMMUNICATIONS, INTERNAL AND EXTERNAL
Verbal / Oral
Visual
Written
Electronic methods of communication
Telephones
Mobile-phones
Internet
Email
Intranet
Teleconferencing and Video-conferencing
Factors affecting choice of medium:
83 POSTAL SERVICES
84 TRENDS IN COMMUNICATION
Tablets and Smart-phones:
Social Media:
Application Stores
UNIT 9 TRANSPORT
91 TRANSPORTATION
Importance of Transportation
Modes of Transportation
Pipelines (Transport of gases, liquids)Road Transport
Rail Transport
Air Transportation
Sea Transportation
Waterways
Pipelines
Factors affecting choice of method of transport
Cost of transportation:
Risk of damage and safety issues
Urgency or speed required
Convenience
Distance
Nature of goods
Quantity to be transported
Value of goods and security needed
Effects of owning transport to a business:
92 CONTAINERIZATION
93 PORTS AND AIRPORTS
Port Authorities:
Airport Authorities:
94 TRANSPORT DOCUMENTS:
(i) Delivery Note:
(ii) Consignment Note:
(iii) Bill of Lading:
(iv) Air Waybill:
95 DEVELOPMENT AND TRENDS IN TRANSPORTATION
Chartering Transport:
Express Routes
Changes in use of rail transport, mass transit system and high speed trains:
Increased use of freight forwarders:
UNIT 10 WAREHOUSING
101 ROLE OF WAREHOUSING
Importance of Warehouses to business and trade
Production
Prices
Regular Supply
Prepares goods and make them sale-able:
Display of goods:
Services to International Trade:
102 TYPES OF WAREHOUSES:
Bonded Warehouse:
Cold Storage Warehouse:
Cash and Carry warehouses:
Manufacturer and Retailer Warehouses:
Regional Distribution Centers:
UNIT 11 INSURANCE
111 PURPOSES OF INSURANCE
How does Insurance help the economy?
The importance of pooling of Risk
112 BUSINESS AND PERSONAL RISKS
Business Risks
Personal Risks
Difference between Insurable and Non Insurable Risks
113 PRINCIPLES OF INSURANCE
Indemnity/Compensation
Insurable Interest:
Utmost Good Faith:
Evaluating Insurance Quotation Depends upon
114 EFFECTING INSURANCE COVER
Procedure:
115 STATISTICAL BASIS OF INSURANCE
Factors affecting the Premium
Premiums and its calculations:
Main Documents of Insurance:
Proposal Form
Cover Note
Insurance Policy
Insurance Broker:
Functions of Insurance Broker:
Benefits to the customers using Insurance Broker:
116 EFFECTING INSURANCE CLAIM
Claim Form:
UNIT 12 BANKING
Introduction
121 BANKING SERVICES
Services offered by the commercial banks:
Savings Account
Current Account
Paying-in Slip:
Issuance of Bank Statement:
Night Safe Deposits:
ATM (Automated Teller Machine) services:
Internet Banking
Telebanking
Bank over-draft
122 MEANS OF PAYMENT IN HOME AND INTERNATIONAL TRADE
Payments in Home trade
Cash:
Cheques:
Credit Transfers / Bank Giro
Standing Orders / Banker’s order:
Direct Debit
Comparison of Standing Order and Direct Debit:
Credit Cards
Debit Cards
Bank Drafts / Cashier’s Cheque / Banker’s Cheque
Factors effecting choice of method of payment
Means of payment in International trade:
Remittances:
Electronic Transfers:
Documentary Credit (Letter of credit)
123 TRENDS IN BANKING
Mobile and digital Banking / Internet Banking:
Mobile Wallets:
UNIT 13 THE BUSINESS UNIT
131 LOCATION OF A BUSINESS INCLUDING RETAIL UNITS
Location of Primary Production Units
Location of Secondary Production Units
Location of Tertiary Production Units
132 PUBLIC AND PRIVATE SECTOR
The Public Sector
Types of Private Sector Organizations
Sole Trader
Partnership
Private Limited Company
Public Limited Company
Public Corporations
134 FRANCHISES
Franchisor:
Franchisee:
Franchise Agreement: 166 O Level Commerce Notes
135 MULTINATIONAL COMPANIES:
UNIT 14 FINANCE
141 SOURCES OF FINANCE
Long term and Short Term Finance
Long-term Financing
Shares:
Debentures:
Mortgage:
Loans:
Sale and Leaseback:
Short-term Financing
Overdraft:
Debt Factoring
Leasing
Trade Credit:
Hire Purchase
Long-term vs Short-term Financing
Methods of Self-Financing
Retained Profits: (Retained Earnings)
Sale of Asset:
Savings:
Sources of Finance in particular given business situations
Finance for commercial activity:
UNIT 15 CHANGING ENVIRONMENT OF COMMERCE
151 COMMERCIAL ACTIVITY AND THE EXTERNAL ENVIRONMENT
Political Factors:
Economic Factors:
Social Factors:
Technological Factors:
152 COMMERCIAL AND ENVIRONMENTAL EFFECTS OF E-COMMERCE
E-shop: (e-store or e-tailer)
Commercial Effects of e-commerce:
153 COMMERCE AND THE ENVIRONMENT
Environmental Effects of e-commerce:
154 CONSUMER PROTECTION
Importance of Consumer Protection
Methods of safeguarding the consumer
Consumers Rights
Actions that a consumer can take:
Faulty Goods:
If after purchase, customer does not like the product:
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