Explain the usefulness of mail orders houses. What type of products are generally handled by them? Specify.
Answers
Answer:
The usefulness of mail orders houses to customers :
(1) Home delivery :
The customers can get their requirement simply by writing a letter to the store. Thus they are saved from troubles, inconveniences and expenses of going to bazaar.
(2) Cheap goods :
The mail order business houses are not doing their business at the mercy of middleman. They buy direct from the manufacturers . Hence they are in a position to sell their goods at cheap rates.
(3) Standardised goods :
Generally mail order business houses deals in standard goods. Thus , they can win the confidence of customers. On the other hand customers are sure that they will get standard goods.
(4) Fulfillment of all needs :
mail order business can return all needs of the customers, even those which are not available in the local markets.
(5) Easy to arrange money :
Execution of order may take few days. In the meantime customers can easily arrange money.
(6) Large selection ;
The customer get opportunity to select goods from catalogues and the pamphlet.
(7) customers who cannot reach shopping centre because of distance can also buy their requirement by post.
Usefulness of mail order business for sellers :
(1) Country wide market :
Sales can be extended to distant areas of the country. Even it can be developed on international basis.
(2) Economy in distribution :
It ensures economy in distribution and provides all advantages of retail trading. The seller need not maintain a large establishment, including salesman. There is also no need for taking any shop on rent at Central point.
(3) Less capital :
It requires less capital. If he is a middlemen, he need not required to purchase stocks and maintain a warehouse.
(4) No bad debts :
There is no risk of bad debts as sales are made on cash basis. He also need not incur much expenses as collection charges.
(5) Elimination of middlemen :
In this business, there is no need of middlemen . Discount and commission of middlemen can be saved.
The type of products generally handled by order business must satisfy the following conditions :
(1) They can be understood from advertisement /description
(2) Goods capable of immediate use.
(3) Goods are free from liability to spoil or damage in transit.
(4) Goods can be given through pictorial representations.
(5) Goods can be dispatched at low charges.
(6) Goods are easily available.
Hence, hair oils, chemicals, pens, patent medicines, toys, footwears, watches, jewelry, soaps, toilet goods provide sufficient score for mail order business.
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Answer:
Mail Order Houses are the retail outlets that sell their merchandise through mail. There is generally no direct personal contact between the buyers and the sellers in this type of trading.
Advantages of Mail Order Houses:
(i) Limited capital requirements, mail order business can be started with relatively low amount of capital as it does not require heavy expenditure on building and other infrastructural facilities.
(ii)Elimination of middlemen, between the buyers and sellers are eliminated which results in savings to the buyers as well as to the sellers.
(iii)Absence of bad debts, the mail order houses do not extend credit facilities to the customers, there are no chances of any bad debt on account of non-payment by the customers.
(iv)Wide reach, as a large number of people throughout the country can be served through mail and the goods can be sent to all the places having postal services.
(v)Convenience, is very convenient for the consumers as the goods are delivered at the doorstep of the customers.
Mail Order Houses usually deals only in the goods that can be:
(1)Graded and standardised
(2)Easily transported at low cost
(3)Have ready demand in the market
(4)Are available in large quantity throughout the year
(5)Involve least possible competition in the market
(6)Described through pictures,etc.