Tag: role of market/bazaar

The arrangement between the merchant and the weavers is an example of a putting-out system, whereby the merchant supplies the raw material to the weavers and receives the finished product. The merchant distributes work among the weavers based on the orders he has received for cloth. The weavers get the yarn from the merchant and supply him the cloth. Thus, the merchant gives orders for what is to be made.

The buying process starts when a buyer recognizes a problem or need. The need can be triggered by internal or external stimuli. Marketers need to identify the circumstances that trigger a particular need so that they can develop marketing strategies that trigger consumer interest.

The merchant supplies the cotton cloth produced by the weavers to a garment-exporting factory. The garment exporting factory will use the cloth to make shirts. The shirts will be exported to foreign buyers. Among the foreign buyers are businesspersons from the US and Europe who run a chain of stores.

Marketers often use the term market to cover various groupings of customers. They view the sellers as constituting the industry and the buyers as constituting the market. They talk about need markets, product markets, demographic markets, and geographic markets or they extend the concept to cover other markets, such as voter markets.

The foreign businesspersons run a chain of stores. These large stores do business strictly on their own terms. They demand the lowest prices from the supplier and sell the products by making huge profits. In addition, they set high standards for quality of production and timely delivery. Thus, we can say, the foreign businessperson makes huge profits in the market.

The arrangement between the merchant and the weavers is an example of a putting-out system, whereby the merchant supplies the raw material and receives the finished product. The merchant distributes work among the weavers based on the orders he has received for cloth. The weavers get the yarn from the merchant and supply him the cloth.

The foreign businessperson makes huge profits in the market. Compared to this, the garment exporter makes only moderate profits. On the other hand, the earnings of the workers at the garment export factory are barely enough to cover their day-to-day needs.

The weavers depend on merchants for the raw materials and markets. Thus, the weavers have a lot of power. They give orders for what is to be made and pay a very low price for making the cloth. The weavers have no way of knowing who they are making the cloth for or at what price it will be sold.  At the cloth market, the merchants sell the cloth to the garment factories. In this way, the market works more in favour of the merchants.

Exporter is a person or a company authorized by government agency to move the goods out of the border of a country. The value of goods is received from the overseas buyer by the exporter, as he is considered the seller of goods. The exporter receives export order against goods to be exported.