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230 BUSINESS  STUDIES dislikes of the buyers and cannot clear without postal facilities, this type of all their doubts through catalogues business has limited prospects. and advertisements. (ii) High promotion cost: The mail Consumer Cooperative Store order business has to rely heavily on A consumer cooperative store is an advertisements and other methods of promotion in order to inform and organisation owned, managed and persuade the potential buyers to buy controlled by consumers themselves. The objective of such stores is to their products. As a result, there is reduce the number of middlemen heavy expenditure on promotion of who increase the cost of produce, and the products. (iii) No after sales service: In mail therebyprovideservicetothemembers. order selling, the buyers and sellers The cooperative stores generally buy in large quantity, directly from may be located very far away from each manufacturers or wholesalers and sell other and there is no personal contact between the two. As a result, there is them to the consumers at reasonable absence of after sales services which prices. Since the middleman are is so important for the satisfaction of eliminated or reduced, the members get products of good quality at cheaper the customers. rates. The profits earned by consumer (iv) Nocreditfacilities:Themailorder houses do not provide credit facilities cooperative stores during a year to the buyers. Thus, customers with are utilised for declaring bonus to limited means may not be interested members and for strengthening the general reserves and general welfare in this type of trading. (v) Delayed delivery: There is no funds or similar funds for social and immediate delivery of goods to the educational benefits of the members. customers, as receipt and execution of To start a consumer cooperative order through mail takes its own time. store, at least 10 people have to come together and form a voluntary (vi) Possibility of abuse: This type of business provides greater possibility association and get it registered under of abuse to dishonest traders to cheat the Cooperative Societies Act. The the customers by making false claims capital of a cooperative store is raised by issue of shares to members. The about the products or not honouring the commitments made through hand management of the store is democratic bills or advertisements. and entrusted to an elected managing (vii)  High dependence on postal committee where one man one vote is services: The success of mail order the rule. The liability of the members of a cooperative store is generally limited business depends heavily on the availability of efficient postal serviceso the extent of the capital contributed at a place. But in a vast country likeby them. To ensure fair management ours, where many places are still of funds, the accounts of the stores are Reprint 2026-27