The chain of markets is established after various steps. First of all, goods are produced in factories, on farms or in homes.
The wholesale trader buy large quantities of goods and then sell them to other traders.
In the markets, buying and selling takes place between traders. The trader who finally sells the goods to the consumer is called the retailer. This could be a trader in a weekly market, a hawker in the neighbourhood or a shop in a shopping complex.
The roadside hawker buys items from the wholesale trader in the town, who in turn have bought these from other big wholesaler trader in the city. The wholesale trader in the city would have bought these goods in a large quantity from the factory and stored them in a godown. In this way, a chain of markets is established.
The chain of markets serve following purposes
→ Consumers get their goods in small quantities.
→ Producers can sell their goods in bulk easily.
→ Consumer get their goods nearby their homes.