The Meaning of Trade

Trade could be defined as the exchange or buying and selling of goods and services.

Divisions of Trade

Trade is basically divided into two, namely; Home Trade and Foreign Trade.

Home Trade

This is the buying and selling of goods and services within the country.  Examples are trade between Calabar and Uyo, Lagos and Enugu.  One of the features of Home trade is that a common unit of money (naira) is accepted as a means of payment for the trade.  Home trade is further divided into Wholesale and Retail trade.

(i) Wholesale Trade: This involves buying goods in large quantity from the manufacturer or producer and selling in small quantity to the retailer.

(ii) Retail Trade: This involves buying goods in small quantity from the wholesalers and selling in bits or units to the final consumers.

There are two types of retail traders in Nigeria namely large scale retailers and small scale retailers. Large scale retailers are Department stores, supermarkets, mail order firm etc. Small scale retailers are market stall owner, kiosk, hawkers etc.

Products in home trade: Clothing materials, food items like garri, rice, maize, tomatoes; books and other writing materials, building materials and home furnishing: furniture appliances, etc.

Foreign Trade

Meaning of Foreign Trade: This is the buying and selling of goods and services between two or more countries.  It is divided into Imports and Exports trade.

Import Trade: This is the buying of goods and services from other countries into our country. For example: trade between Abuja and Accra; Lagos and USA etc. Nigeria imports goods like automobile parts, electronics etc. It is further divided into visible and invisible import.

Export Trade: This is the selling of goods and services produced in Nigeria to other countries that need them to satisfy the needs of their citizen. Nigeria exports goods like groundnuts, palm produce, rubber and cocoa, crude oil etc. This is also divided into visible and invisible export.

Entreport Trade: This is the re-selling or re-exporting of imported goods by one country to another without changing the goods.

Products in Foreign Trade

Clothes, electronics, drugs, chemical, machinery, mobile phones, paper for printing, etc.