INTERNAL TRADE: CHARACTERISTICS AND REVITALIZATION - CULTURE VOCABULARY - 2025

The domestic trade, domestic, internal or national, is carried out between different individuals or commercial entities within the borders of a country, so their operations are governed by the same law and trade patterns.

Trade in general is related to the exchange of goods and services, both on a small and large scale. It includes the effective economic, legal, social, political, technological and cultural systems in any country or internationally.

Internal trade exists thanks to different sources of resources, specialization and the division of labor. Because a person generally concentrates on a small aspect of production, he needs to market with others the acquisition of goods dissimilar to those he produces.

This type of business can be both wholesale and retail, depending on the volume of commercialization and the target audience. In most countries, domestic trade ranks second or third among the types of industries that make up the national domestic product.

Characteristics of internal trade

- Internal trade is governed by a set of rules, principles and criteria of commercial law that seek to regulate commercial relations. These norms are included in an instrument called the commercial code, which must be respected by the representatives involved in this activity; those who violate it may receive sanctions.

- As a result of this commercial action, the State is paid different taxes to be used to meet the main needs of the country; among these are education, health and safety.

- The law of supply and demand is what will establish the commercial flow and its intensity in the country. The free play between the two will stipulate the quantities of goods to be produced and their costs.

- Internal trade takes place within the same country. It differs from the external in that the latter is the exchange of goods and services carried out by two or more nations with each other.

Wholesale and retail trade

Domestic trade can be divided into two large groups: wholesale and retail.

Wholesale trade

It consists of the wholesale of a large number of products, usually to distributors, corporate clients or intermediaries, who are not the final buyers. For this reason it is the first stage of commercial activity.

Retail commerce

Retail trade is based on direct sales to the final consumer. These merchants purchase products from wholesalers to sell them directly to consumers. An example of this type of business can be a greengrocer.

Formal and informal trade

Internal commerce does not work solely through the activity carried out by formal commerce; that is, those that are duly registered in the commercial register and comply with current regulations.

It also works through the so-called informal trade, also known as street trade. They work without a legal registration and are therefore outside the law.

How do the products reach the consumer?

There are several ways in which products reach the final consumer. These are given according to the different parts of the world and within the different countries that carry it out.

The best known form of sale of goods is through specialized businesses in some area. Located especially in large cities around the world, it is currently being gradually replaced by supermarkets.

However, the most common mode of marketing in developed countries is represented by shopping centers.

Its main characteristic is to be a place that groups together several shops of different categories, plus entertainment and recreation places. This modality is gaining increasing importance in developing countries.

The marketing modalities that have been described are located in urban areas. In rural areas, marketing is usually of the retail type and with specific characteristics.

For example, it may be the existence of small establishments, where you can have access to basic products such as food items. The remaining consumption is obtained in large urban centers.

What is the revitalization of domestic trade?

Through the revitalization of internal trade, it seeks to give it more strength and vitality, either by facilitating and encouraging its operation through good regulation, buying national products within the country and even substituting imports, due to the great value that this trade has for any country.

Clearly, its primary value lies in the fact that internal trade is what allows the community to survive: on the one hand you have supplies and on the other there is a way to obtain the money to buy them.

Importance of internal trade in a country

- Its main value is that it provides the exchange of goods within the country. By doing this, you also ensure that the items of production reach the appropriate locations for the nation's economy to grow.

- It improves the quality of life of its citizens by allowing the different classes of goods to reach all parts of the nation.

- Helps the growth of the industry by guaranteeing the availability of raw materials.

- Provides direct results on the economic development of a country.

- It has effects on the general development of the nation. If the internal trade is mainly formal, the tax collection from it will be higher and will allow the State to compensate social requests. If the income is distributed effectively and without corruption, this will bring greater prosperity to the population.

- The importance that this trade displays in the reproduction of jobs is indisputable. It is the most important employer sector of the working population of a country.

- A successful internal trade serves to evaluate suppliers who aspire to open up to the international market, which allows these local companies to project themselves internationally.

References

1. Mark McCracken (2018). Financial Terms. Taken from: teachmefinance.com.
2. Wikipedia, the free encyclopedia (2018). Commerce. Taken from: en.wikipedia.org.
3. Wikipedia, the free encyclopedia (2018). Domestic trade. Taken from: en.wikipedia.org.
4. B. Heflebower (2018). Internal Trade. International Encyclopedia of the Social Sciences. Taken from: Encyclopedia.com.
5. Florencia Ucha (2012). Internal Trade. Definition ABC Economics. Taken from: definicionabc.com.
6. Claudia Nagel (2018). International domestic trade buying and selling of goods concept. Taken from: historiaybiografias.com.
7. Andrés Sevilla Arias (2018). Commerce. Economipedia. Taken from: economipedia.com.