Internal trade refers to buying and selling of goods & services within the boundaries of a nation. Features of internal trade are goods purchased from an individual or establishment within the boundaries of the country, no custom duty or import duty being levied, goods forming a part of domestic production and consumption etc.
Internal trade can be classified into wholesale trade – this refers to purchase and sale of goods & services in large quantities for the purpose of resale or intermediate use and retail trade- this refers to purchase and sale of goods in relatively small quantities, generally to the ultimate consumers. Traders dealing in wholesale trade are referred to as Wholesalers and traders dealing in retail trade are referred to as Retailers. Wholesalers bear business risk which arise on account of purchase and sale of goods in their own name. They purchase in bulk and sell in small lots to retailers or industrial users. Wholesalers provide services to manufacturers and retailers. Services of wholesalers to manufacturers are facilitating large scale production, bearing risk, facilitating continuity of production etc. Services of wholesalers to retailers are making availability of goods, marketing support, granting of credit, specialised knowledge etc.
Main Documents used in Internal Trade are invoice, proforma invoice, debit note, credit note, railway receipt (RR), lorry receipt (LR). There are various terms used in trade. These are cash on delivery (COD), free on board (FOB), cost , insurance, and freight (CIF), errors and omissions excepted (E&OE).