Explain any two business activities which are auxiliaries to trade.



Q.6:- Explain any two business activities which are auxiliaries to trade.

 

Answer:-

Activities which are meant for assisting trade are known as auxiliaries to trade. These activities are generally, referred to as services because these are in the nature of facilitating the activities relating to industry and trade. Two business activities which are auxiliaries to trade are



(i) Transport and Communication Production of goods generally takes place in particular locations. Transport facilitates movement of raw material to the place of production and the finished products from factories to the place of consumption. Communication facilities help the producers, traders and consumers in exchanging information with one another. Thus, postal services and telephone facilities may also be regarded as auxiliaries to business activities.

(ii) Warehousing Goods are not sold or consumed immediately after production. They are held in stock to be available as and when demand comes. Special arrangement must be made for storage of goods to prevent loss or damage. Warehousing helps business firms to overcome the problem of storage and facilitates the availability of goods when needed.