7th August 2020




SUBJECT: Business Studies

TOPIC: Aids to Trade

REFERENCE: Meybiks New Basic Business Studies

Brief explanation:

Trade is an act of buying and selling of goods and services to satisfy consumers’ wants. Those who engage in buying and selling of goods often encounter several difficulties. These difficulties are removed by supporting factors known as aids to trade.

Note for the pupils:


These are services that facilitate business activities and make it easy for people who are engaged in buying and selling. Aids to trade include:

  1. a) Banking
  2. b) Advertising
  3. c) Communication
  4. d) Transportation
  5. e) Warehousing etc

Banking: A bank is a place where people’s money and other valuables are safeguarded, to be given back to the owners on demand.

Importance of Banking to Traders

  1. Accepting of deposits such as money, important documents, valuables like jewelries etc from individuals or organization for safe keeping.
  2. Banks provide capital to businessmen for purchases of business equipment, raw materials etc. This could be in form of loans or overdraft.
  • Banks act as agents of their customers in activities such as collecting and paying of cheques.


     Advertising: This is the process of creating awareness about the existence of a product in order to promote demand/sales.

Importance of advertising to traders

  1. It helps to inform and educate on how best to use the product or services made available to them.
  2. Advertising informs and directs the audience where to get the items.
  • Advertising gets consumers aware of the existence of new products and services.




Communication: Communication is the transmission of information from one person to another or from one organization to another.

Importance of communication

  1. Communication creates awareness and induces demand for goods and services.
  2. Through communication, goods can be sent to buyers and payment made without physical contact of both the buyer and the seller. This is through telephone calls, text messages, e-mail etc.
  • The emergence of e-mail has enabled people to send and receive printed information such as invoice, debit and credit note catalogues etc. online.


Transportation: Transportation involves the movement of goods and passengers from one place to another.

Importance of transportation to traders

  1. Transportation helps to move goods that are in abundance in one area to an area where they are scarce.
  2. It enables in the movement of people from one place to the other.
  • Transportation aids effective distribution of goods.

Warehousing: A warehouse is a large building or store where goods are stored until they are needed or before distribution to outlets.

Importance of warehousing to traders

  1. Warehousing provides storage facilities for goods produced ahead of demand.
  2. Warehousing encourages large scale production of goods.
  • Warehousing helps to stabilize price of goods in the market. Goods stored in the warehouses are sent to the market according to demand, so there won’t be too much supply which causes prices to fall.



  1. Define aids to trade
  2. List and explain four aids to trade
  3. State the importance in (1) above.
  4. A large building where goods are stored until they are needed is called…………..