DEPARTMENT OF TECHNICAL EDUCATION

ANDHRA PRADESH
Name : A. Srinivas Kumar
Designation : Senior lecturer
Branch : Commercial and computer Practice
Institution : Government polytechnic
for women, Nandigama.
Year/ semestar : 1st year
Subject code : CCP -104
Topic : Distribution network
Duration : 50 Mts.
Sub topic : Advantages and disadvantages
of Mail order business.

CCP104.92 1
Objectives

On completion of period, you would be

able to

 Explain the advantages of mail order business

 Explain the disadvantages of mail order
business

CCP104.92 2
Advantages of Mail Order Business

Convenience
 The customer is able to get the desired
goods at his place without spending his time
and money

Quality
 Quality is also ensured in this business

CCP104.92 3
Advantages of Mail Order Business

Returns:
 If customer is not satisfied with the product since
goods are guaranteed, the seller takes them
back

No Middlemen:
 Since there are no middlemen between buyer
and seller, there is a possibility for getting the
goods at a low price

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Advantages of Mail Order Business

Low Price:
 Low operating costs also makes possible to
supply at a low price

Premises
Mail order business does not require
 costly location

 well decorated and furnished premises

 large stocks
 free services
 expert services
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Advantages of Mail Order Business
Variety
It deals with :
 a wide variety of merchandise

 provides articles not available in local

markets also

Distant Markets
 Its sales can be extended to local markets
 but it can cover all the market segments
wherever the postal services are available

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Advantages of Mail Order Business

 Covers distant markets which enhances the sales

of the firm

Less Capital
 can be carried out with small capital since huge
stocks need not be maintained
 The possibility for business risk is also minimum
Flexibility
 The method of sale, type of goods etc. can be
easily changed to suit the present day
requirements
CCP104.92 7
Disadvantages of Mail Order Business

No personal contacts:

 The customers cannot personally inspect the

goods for quality, price, durability before he
purchases the product

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Disadvantages of Mail Order Business

Delay:
 Customers will have to wait for several days
to get the delivery of goods after the order is
placed
Damages
 There is a risk of loss due to damage of
goods in transit
Complaints
 complaints cannot be solved quickly since the
seller is far away from buyer

CCP104.92 9
Disadvantages of Mail Order Business

Less variety
 This business is applicable for limited varieties
of products which are not bulky and perishable

Illiteracy
 If illiteracy rate is high, this method is not that
suitable. Uneducated people and those living in
rural areas with insufficient postal services
cannot be approached

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Disadvantages of Mail Order Business

Services:

 Customers do not get any service from the

sellers such as credit, after sale service,
repairs etc.,

Heavy Advertising:

 It has to spend heavily on giving advertisements

in news papers and magazines in undertaking
sales
promotional programmes in preparing the mailing
lists and catalogues
CCP104.92 11
Disadvantages of Mail Order Business

Packing
 Since the goods are to be sent to distant
places by post, special packaging
expenses would be high in this business

Cheating
 This kind of retailing offers sufficient
opportunity for cheating the customers

CCP104.92 12
Summary
Advantages of Mail Order Business:

a) Convenience b) Quality c) Low Price d) Low

operating costs e) Wide variety f) Distant Markets
g) Less capital h) Flexibility.

Disadvantage of Mail Order Business:

a) Lack of personal contacts b) Delay in getting

goods
c) damage of goods d) Limited scope e) Illiteracy f)
Lack of services g) High promotional expenditure h)
High packaging expenses i) Scope for fraud.
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Assignment

1. What is Mail Order Business

2. What are the advantages and
disadvantages of Mail order Business

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Frequently Asked Questions
1. What are the advantages of Mail Order
Business?

3. What are the disadvantages of Mail Order

Business?

5. Briefly explain six advantage and disadvantages

of Mail Order business

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Quiz

1. Mail Order Business is done through

b) Post
c) Shops
d) Super Markets
e) None

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2) Advantage of Mail order Business is :

c) low cost
d) Show room not needed
e) Wide variety
f) All

CCP104.92 17