SS1 Commerce Lesson Note on Functions of Agents

The website has the complete lesson note for all the subjects in secondary school but this piece showcases the SS1 Commerce Lesson Note on Functions of Agents. You can use the website search button to filter out the subject of interest to you.

CLICK HERE to download the complete Document: DOWNLOAD HERE

TOPIC: HOME TRADE

CONTENT

1. Home Trade (cont’d)Survival process
2. Functions of agents
3. Types of warehouses and
4. Necessary documents

SUB-TOPIC 1: MEANING OF HOME TRADE:

Home trade is the act of buying and selling of goods and services within the country.

ADVANTAGES OF HOME TRADE

1. No language barrier since buyers and sellers are close to each other
2. There is no foreign exchange problem. The distance over which goods are to move are very short compare to foreign trade.
3. There is no difference in the weights and measures used by both the buyers and the sellers since both groups are subject to the same laws.
4. The political and legal systems are too less heterogeneous than in the case of foreign trade.

SUB-TOPIC 2: FUNCTIONS OF AGENTS

An agent is a person employed for the purpose of establishing a contractual relationship between the principal (who is the person employing the agent) and someone else. In commerce, an agent is the person employed for the purpose of selling goods on behalf of the principal. The person employing the agent is either the producer, foreign supplier, or someone larger scale domestic wholesale trader. They assist in negotiating sales and purchases or both on behalf of their principals.

TYPES OF AGENT/AGENT MIDDLEMEN

1. Brokers: are agents employed to bring into contact intending sellers and buyers. Brokers are never in possession of any goods and do not sell goods in their own name. They do not have authority to fix prices. They do not contract to work on a continue basis with any principal. They can act for several principal at the same time. They negotiate the goods with the buyer and inform the seller about the bargaining.
2. Factors or manufacturers’ agents: they are commercial agents who have authority to sell goods and who keep custody of goods until the goods are sold. They sell goods under own name. They are independent because they are not employees of any manufacturer. They do not control pricing policy. They have a continue relationship with their principals.
3. Selling agents: are agents performing the complete range of marketing functions for manufacturers. They perform the fullness and widest range of marketing functions for the manufacturers. They render the marketing departments of manufacturer more or less redundant and superfluous.
4. Del credere agents: these are agents employed to sell goods on the understanding that they would take full responsibility for any default on credit sales. They undertake that buyer would pay and if they are not, the agent will be liable.
5. Auctioneers: are agents whose duty is to sell goods at public auctions.

SUB-TOPIC 3:TYPES OF WAREHOUSES

Meaning of warehousing: This is concerned with all activities that help in storing goods until they are needed/demanded in order to ensure uninterrupted and regular supply.

FACTORS TO BE CONSIDERED IN SITING A WAREHOUSE

1. Total operating cost
2. Proximity to the factory
3. Means of transportation
4. Availability of basic social amenities
5. Cost of rentage or construction
6. Nearness to the consumers
7. Nature of the product
8. Distribution centre

Click on the Downloadable Button to get the FULL NOTE