What is the significance of different aids-to-trade?

A great deal of difficulties are experienced in the course of exchange of goods and services. The activities which help in overcoming those difficulties or hindrances are called aids-to-trade or “auxiliaries to trade”. The examples of aids-to-trade are banking, insurance, warehousing, transport and advertising. The significance of these aids-to-trade are:

Banking: Banks helps in overcoming  the financial problems of the business enterprise. Banks provide finance for holding stock between the time of purchase to the time of sale.

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Warehousing: Goods are generally produced in the anticipation of demand. All the goods produced are not consumed at the same time, warehousing provide suitable arrangement for storing the goods.


Insurance: It is regards as the best means of reducing risks of the business. Insurance covers the risks of loss to goods  in transit and in warehouse on account of theft and fire.

Transport: It creates place utility of the products. It helps in carrying the goods from the production centre to the consumption centre and thereby create place utility for  the products.

Advertisement: Consumers are unaware on the new products. Advertisement and publicity bring the goods to the notice of the consumer.

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