Internal Trade - Meaning and Features

The goods produced in a country may be sold within the country or outside the country. When buying and selling of goods and services takes place within the geographical boundaries of a country, it is referred to as internal trade. It may take place between buyers and sellers in the same locality, village, town or city; or may be in different states, but definitely within the same country. Internal trade is also called domestic trade or home trade.

Features of Internal Trade

1. The buying and selling of goods takes place within the boundaries of the same country.

2. Payment for goods and services is made in the currency of the home country.

3. It involves transactions between the producers, consumers and the middlemen.

4. It consists of a distribution network of middlemen and agencies engaged in exchange of goods and services.

Classification of Internal Trade

Generally we buy goods of our daily use from the local shopkeepers. These shopkeepers buy goods in bulk and sell them to us as per our requirement. But do you know from where these shopkeepers buy those goods? They generally buy goods in large quantity either from the producers directly or from any other shops that sell goods in bulk.

Thus, we find that some shopkeepers buy goods in bulk and sell to others in bulk while other buy in bulk and sell in small quantities as per the requirement of the customers. Thus, on the basis of volume of goods traded we can classify internal trade as:

1. Wholesale trade
2. Retail trade