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CHRIST THE KING COLLEGE GWAGWALADA, ABUJA

SS 1 THIRD TERM COMMERCE NOTE

BY

NWAKPU CHIOMA AGNES (MISS)

CAREER OPPORTUNITIES FOR COMMERCIAL STUDIES

There are various career opportunities available for people in the labour market especially

commercial students. Individuals with school certificate (O’level), diploma certificates and degree

certificates holders have opportunities to work in both private and public sectors.

CAREER OPPORTUNITIES IN PUBLIC SECTOR

The public sector owners are the federal, state and local government. The federal government is the

largest employer of labour in Nigeria. The job categories available for graduates of universities

(degree) and polytechnics (Higher National Diploma) are Budget Analyst, Chief Executive Officer,

Higher Executive Officer, Principal Executive Officer, Personnel Officer, Administrative Assistant,

Accountant, Economist while school certificate holder may work as clerical officers, secretary grade

IV, office assistants, drivers and cleaners.

At the state and local government levels, career opportunities are bound for university and

polytechnic graduates are employed as health care workers, high way managers, safety control

officers, clerks, book-keepers etc. Employee in the civil or public service are referred to as civil and

public servants

CAREER OPPORTUNITIES IN PRIVATE SECTORS

There are a lot of clerical and management occupations in the private sector. They are categorised

below as;

i. Marketing and Sales: Trading/Retailing/wholesaling/, transportation, warehousing/storekeeping,

Advertising, marketing/salesmanship etc

ii. Communication and Research Industries: Research assistants, research supervisors and directors,

businessmen at a conference, sales analyst, agent, advertising client service executives, managers,

artists in advertising agency, salesmen, sales representatives

iii. Production and materials manager: Traffic managers, Inventory officers, purchasing agents,

Purchasing of agents, Quality control analyst, Industrial designers

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iv. Financial Areas: Bank officers, Loan officers, Accountants, Cashiers, Trust officers, Investment

bankers, Financial analyst, Treasury officers

v. Management as a profession: Inventory control specialist, Personnel officers, Management

trainees, Middle level managers, Top level manager, Record and statistics officers, Administrative

officers

vi. Insurance Industry: Claim examiners, Underwriters, Claim adjusters, Actuaries, Agents, stock

Broking

vii. Accounting and Management Information System: Book-keepers, Account clerks, Accountants,

Auditors, Tax consultants, Financial managers, Credit analysts, Cost analyst, Cost accountant, System

analyst, Data based computer operators

A sound knowledge of mathematics is required to undertake a course of study in Accounting and

Management Information System

CAREER OPPORTUNITIES IN THE TEACHING PROFESSION

i. Teachers in secondary schools ii. Lecturers in polytechnics

iii. Lecturers in College of Education iv. Lecturers in the Universities

v. Professors vi. Bursars vii. Registrars

People can be employed as Masters Grade I – II, Senior teachers, Principals, Lecturers I – III and

Associate Professors

REQUIREMENTS FOR ENGAGEMENT IN COMMERCIAL FIELD

a. Basic requirements for unskilled jobs: Unskilled jobs are reserved for holders of first school

leaving certificate (primary 6) e.g messengers and office assistance

b. Basic requirements for semi-skilled jobs: Semi-skilled jobs such as clerical jobs in account,

administration, banking etc are reserved for holders of secondary school certificates and National

Diploma certificates depending on grade level

c. Basic requirements for Management Trainee top management for executive level: Holders of

first degree or Higher National Diploma (HND) are offered appointment for middle level

management and holders of second degree for top management level. In the public service, a fresh

graduate is employed as a Grade level 08 officer

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d. Commercial courses: Graduates of Degree and HND of the following professions are employed in

all the career opportunities explained above, depending on one’s area of specialisation, this could

be;

i. Economics ii. Insurance iii. Management iv. Banking

v. Actuarial Science vi. Accounting vii. Industrial relations

viii. Personnel management ix. Public Administration x. Marketing

xi. Secretarial Administration

e. Professional Examination: There is need for higher professional examination to be taken after the

above listed professions in order to attain top management level in an organisation. Some

institution conducting professional examinations are;

i. Chartered Institute of Bankers of Nigeria (CIBN)

ii. Institute of Chartered Accountants of Nigeria (ICAN)

iii. Nigerian Institute of Marketing (NIMARK) iv. Chartered Institute of Taxation

v. Nigerian Institute of Management (NIM) vi. Chartered Institute of Insurance

All graduates (degree and HND) of commercial courses are eligible to sit for the examination of the above listed institutions. They must also have a minimum of five credits, including English, Mathematics and Economics in O’level examination

f. Current university entry requirement for professional and educational courses

COURSES UTME ENTRY REQUIREMENTS UTME SUBJECTS

1. Accounting 2. Economics 3. Insurance 4. Management 5. Marketing 6. Secretarial Administration 7. Banking 8. Actuarial Science 9. Industrial and Personnel Management 10. Finance 11. Public Administration

Five O’level credit including English, Mathematics, Economics and any two of the following subjects; Commerce, Accounting, Statistics, Government, Business methods, Geography. Holders of Diploma in related courses from a recognised polytechnic can also apply for direct admission into any of the courses

English, Mathematics, Economics plus any one of the subjects listed under entry requirements

Note: Prospective candidates are advised to study the UTME brochure carefully before choosing a

particular course

TYPES OF CO-OPERATIVE SOCIETY

i. Retail co-operative society ii. Consumers’ co-operative society

iii. Credit and Thrift co-operative society iv. Wholesale co-operative society

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v. Producer co-operative society vi. Multi-purpose/Apex co-operative

1. RETAIL CO-OPERATIVE SOCIETY: Formed by retailers pooling their funds together to enable bulk

purchase and goods are retailed to members at a relatively lower price. Profits are shared in

proportion to the amount of purchases made by each member and buy in bulk from

producers/wholesalers and distribute among members. Profit is shared among members based on

patronage

2. CONSUMERS CO-OPERATIVE SOCIETY: Made up of consumers, they protect themselves against

exorbitant price of sellers (middlemen). They buy in large quantities and distribute to members in

small quantity. They settle disputes among members. Profit is shared among members based on

patronage

3. CREDIT AND THRIFT CO-OPERATIVE SOCIETY: Formed by low income earners, encourage savings

habit among members, enable low income earners to pool large funds by monthly or weekly

contribution, grants loans to members at low interest rates. Profit is shared among members based

on patronage

4. WHOLESALE CO-OPERATIVE SOCIETY: Formed by wholesalers who buys from producers and sell

in small quantities to co-operative retailers. They are able to raise large amount to finance wholesale

purchases. Profit is shared among members based on patronage

5. PRODUCERS CO-OPERATIVE SOCIETY: Formed by producers of similar commodities who

undertake joint marketing of products on wholesale or retail basis. They organise co-operative

production. They jointly buy or lease equipment. Profit is shared among members based on

patronage

6. APEX/MULTI-PURPOSE CO-OPERATIVE SOCIETY: Formed by existing co-operative societies. They

make facilities available for sharing among member societies. They serve as protective body for

members. They mediate in case of rift among members

DOCUMENTS INVOLVED IN THE FORMATION OF LIMITED LIABILITY COMPANY

1. MEMORANDUM OF ASSOCIATION: It is a document that contains the rules that regulates the

affairs of the company with the outside world. It must be filed with the Registrar of companies. It

contains:

the name of the company with Plc/Ltd as the last word

The registered offices is located/address

The objectives of the company/purpose for which the company is set up

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Names of promoters/directors, their shareholding and their signatures to show consent

The amount of capital contributed by each

The amount of authorised share capital

The nominal or par value of each share

A statement that the liability of the members is limited

2. ARTICLES OF ASSOCIATION: It is a document which regulates the structure and internal

management of the company; it must be filed with the Registrar of companies. It contains the

following:

It states the rights of different classes of shareholders.

It states the rules/procedures of conducting meetings.

It regulates the issue of shares.

It states the election, limitation and rights of directors.

It states the borrowing powers of the company

3. DECLARATION STATEMENT: This is a statement in writing to the Registrar of companies by the

promoters. It states that the requirement of the companies have been complied with. It is a

declaration that adequate capital has been raised. The promoters are held liable for any false

declaration

4. CERTIFICATE OF INCORPORATION: It is a document issued by the Registrar of companies to the

promoters after all document have been found to be in order. It signifies that the company has

come into legal existence from that month. It establishes the company as a legal entity recognised

by laws of the state which can now sue and be sued. It is the birth certificate of the company

5. PROSPECTUS: It is an invitation to the public in writing to make an offer to buy shares. It is used

when dealing with new shares. It contains company’s history (which includes the financial accounts)

and future prospects. It provides information about the rights and classes of the shares

6. TRADING CERTIFICATE: This is a document issued by the Registrar of companies. It gives the

public company the right to commence the business for which it was formed. It is only issued after

Companies Act conditions have been met. It is obtained within one year of incorporation. It lapses if

a company did not start operation within one year of its issue

DIFFERENCES BETWEEN MEMORANDUM OF ASSOCIATION AND ARTICLES OF ASSOCIATION

Memorandum of association contains all the conditions required for the registration of a company

while articles of association contains only the rules and regulations of the company

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Memorandum of association contains names of promoters, authorised capital and the amount of

capital contribution while articles of association contain the rights of shareholders, directors and

procedures of conducting meetings

Memorandum of association defines the relationship between a company and its external parties

while articles of association govern the relationship between the company and its members

FACTORS THAT COULD LEAD TO LIQUIDATION OF LIMITED LIABILITY COMPANIES

i. Court order: If the business owes more than it can afford to pay back, a creditor can apply

to court for liquidation

ii. If the objects of the company become illegal, this could cause it to close down

iii. If the company did not render the statutory reports within the maximum period allowed

iv. Voluntary liquidation: If the shareholder pass a resolution to wind up

v. If the business fails to commence within one year of incorporation

vi. If the number of shareholders falls below the statutory requirement

vii. Continuous disagreement among the directors over the management of the company

viii. If the purpose for which the company was set up has been fulfilled

ix. If the company is insolvent

x. If the company cannot meet up with the capital requirement for the line of business

SHARES

This can be defined as a unit of capital of a limited liability company owned by a shareholder. It is the

interest which a shareholder has in a company

SHARE CERTIFICATE: It is an evidence of share allotment to shareholders. It states the number of

shares allotted its holders. It shows the normal value of each share, the category or class of shares

and the rights that are accrued to each of them

UNDERWRITING OF SHARES: This refers to the undertaking by financial institutions to take part or

whole of shares issued if not fully subscribed to by the public. It is a guarantee that shares will be

taken up. Underwriters receive commission. When demand for shares improve, underwriters resell

the unsold shares and make profit

DIVIDEND: This is a share of profit of a limited company distributed to the shareholders. It is paid

only when profits are made. The amount payable is based on the number of shares held. It is only

payable when profit is declared by the company. It is paid through dividend warrant

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DIVIDEND WARRANT: This is a draft issued by a limited company and made payable to a shareholder

for the amount of dividend owed to him for a stated period. It is made payable to payee only.

PROMOTERS: A promoter is an individual or group of people who conceive the idea of a company.

He undertakes to fulfil the legal requirements for the venture. He can enter into pre-incorporation

contract. Or They are people who form or float a company and establish it as a going concern. They

are a class of people skilled in dealing with the preliminaries necessary to the formation of a

company and who possess expert knowledge of the investing public(when it is a public company).

They stand in a trust position to the company they promote and must not derive any personal gain

from the work of promotion with first disclosing the fact to the independent representatives

RIGHTS OF SHAREHOLDERS

i. Shareholders have right to vote at meetings

ii. They have rights to dividends

iii. They have right to participate in the distribution of assets in the event of liquidation

iv. They have right to appoint by proxy to represent them at meetings

v. They have rights to receive notice of general meeting

CLASSES OF SHARES OF A PUBLIC COMPANY

1. Ordinary/Equity Shares 2. Preference Shares

1. Ordinary/Equity shares: These types of shares are known as equities as they rank equally. Holders

are the real owners of Public companies. They receive dividends only after other Preference

shareholders have been paid. Holders of ordinary share can vote and be voted for. It is not

redeemable. It has not fixed rate of dividend. Holders may or may not get anything if the company

makes little or no profit. It is divided into two: Preferred and Deferred/Founders shares

a. Preferred ordinary shares: This type of shares receive a fixed rate of dividend after the Preference

share holders have received their dividend. They have voting rights

b. Deferred/Founders shares: These are issued to the founders/promoters of the company. They are

no longer common in public companies. Holders have right to the remainder of the profit of after

ordinary shares have received a state amount. They are often issued as a part payment to the

owners of a company that has been bought up

2. Preference shares: These have fixed rate of dividend. Owners receive dividend first before all

others. Holders are also entitled to return of capital first at winding up. Holders have no voting rights

or restricted voting rights. It is divided into: Cumulative, Non-cumulative, Participating, Redeemable

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a. Cumulative Preference shares: These have priority in the sharing of dividends over others. They

get arrears of dividends not paid before other classes get dividends. Holders have no voting rights.

Holders receive fixed rate of dividend. They do not enjoy any rights and privileges of the company

b. Non-cumulative: These do not get arrears of dividend not paid before other classes get dividend.

Holders have no voting rights. Holders receive fixed rate of dividend

c. Participating: These receive fixed rate of dividend like other preference shares. They also get their

dividend first before the ordinary share. They are entitled to further dividends after the ordinary

shares have received a specific percentage of the profits. The term are usually specified in the

articles of association

d. Redeemable: These have prior claims before all other preference shares. They have the

disadvantage of being bought back by the company hence the name redeemable. The companies

use their profits or proceeds to further issues of shares to buy back these shares. These type of

shares are issued to finance particular projects to be repaid when the project is completed. Or

redeemable out of proceeds of fresh issues of shares

Ordinary shares Preference shares

i. Holders receive fluctuating dividend rates Holders receive fixed rate of dividend

ii. Holders have voting rights holders have restricted voting rights

iii. It is not redeemable It is redeemable

iv. Dividends are paid only if profits are made Dividends are paid whether or not profit is made

v. Receive dividend after Preference holders First to receive dividend

DEBENTURE: These are long term loan capital given under a company’s seal which attracts a fixed

rate of interest which must be paid whether a company makes profit or not. It may be secured on

the assets of the company (mortgage debenture). The Holders are not members of the company but

creditors. They do not enjoy any rights and privileges of the company

Types of Debenture

i. Mortgage Debenture

ii. Naked or Simple Debenture

iii. Secured Debenture

iv. Redeemable Debenture

v. Irredeemable Debenture

Shareholders Debenture holders(DH)

I. Holders are owners of a company Holders are creditors to a company

ii. Shareholders are paid dividend Debenture holders are paid interest

iii. Holders have voting rights Holders have no voting rights

iv. Receive Dividend after payment of DH claims Receive their claims before shareholders

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v. Shares have no fixed rate of dividend Holders receive fixed rate of interest

TRADE ASSOCIATIONS AND OTHER ENTERPRISES

Trade association is an association of traders or producers engaged in the same line of trade, whose

major aim is to protect and safeguard the interest of their members as well their businesses. It is a

group of firms in the same trade. Eg. Butchers Association, Manufacturers’ Association(MAN),

Nigerian Labour Congress (NLC), Nigerian Union of Teachers, Nigerian Medical Association etc

AIMS AND OBJECTIVES OF TRADE ASSOCIATIONS

i. To ensure that members provide good quality services

ii. To ensure that members charge uniform price

iii. To maintain professional ethics of their line of trade

iv. To supply members with information about development in their line of trade

v. To create uniformity in the way their members deal with people

vi. To promote trade in a particular line of business

vii. To act as pressure groups in order to influence some government policies

viii. To defend and advance the interest of members

ix. To assist members who are in need

FUNCTIONS OF TRADE ASSOCIATIONS

i. They disseminate information to members

ii. They fix prices for their services or products

iii. They put political pressure on government for the interest of their members

iv. They settle disputes among members

v. They provide credit facilities and assistance to members

vi. They negotiate with other trade association on collective basis

vii. They educate members on trade activities etc

viii. They draw up standard for the practice of their trade

ix. They carry out research and publish the report for members use

CHAMBER OF COMMERCE

Chamber of commerce is an association of merchants, manufacturers and businessmen from

different commercial fields or various lines of businesses who agree to come together in a town or

city with the aim of representing and protecting their business interest. This is not restricted to a

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particular trade. The members come together to have trade connections as well as to further their

business interest. There are national and international chambers of commerce such as;

i. London Chamber of Commerce ii. International Chamber of Commerce

iii. Lagos Chamber of Commerce iv. Ijebu Chamber of Commerce

v. Nigeria-American Chamber of Commerce vi. Owerri Chamber of Commerce

AIMS AND OBJECTIVES

i. To promote commercial activities in a community, country or town

ii. To liaise with other chambers of commerce in relation to their business interest

iii. To influence the policy of the government relating to commercial activities in an area

iv. To further business interest of the area

FUNCTIONS OF CHAMBER OF COMMERCE

i. To organise trade fairs and exhibitions: Chamber of commerce organises trade fairs in order to

promote their businesses to the customers

ii. To promote home and foreign trade: They develop trade with other towns outside the country or

other towns within its territory

iii. To co-operate with other chambers of commerce: They can co-operate with other chamber of

commerce in the country and outside the country

iv. To collect and disseminate information to members: They supply all relevant information to

members in their areas of interest as well as the latest development in the world of commerce

v. Settlement of disputes among members: They can act as arbitrators in the settlement of disputes

among its members

vi. They act as watchdogs in the administration of government laws: Chambers of commerce are

set up to watch how government laws are administered so as to prevent anything injurious to their

commercial interest

vii. To educate members on governmental legislations: Chambers of commerce do educate their

members on government policies on matters relating to customs’ regulations and tariff of other

countries

viii. To educate members on conditions of trade and industry: Chambers of commerce can educate

members on the conditions of trade and industry in a country

MANUFACTURING ASSOCIATION

Manufacturing association is an association of business executives or entrepreneurs in a city, town

or country that have common interest in the manufacturing of goods and other commodities e.g the

Manufacturer’s Association of Nigeria (MAN)

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FUNCTIONS OF MANUFACTURING ASSOCIATION

i. It provides for manufacturers, the means of formulating and influencing policies on industrial

matters i.e it acts as a pressure group

ii. It encourages manufacturers to contribute towards the management of the national economy by

being represented on all organisations whose work affects the interest of manufacturers

iii. It encourages a high standard of quality of members’ products through the collection and

circulation of useful information to members

iv. It gives advice on the use of products and on the safety and precaution on the use of the

products

v. It establishes effective communication channels with other similar bodies in order to attain the

objectives of the association on matters of common interest

vi. If finances research into the development of raw materials and production techniques

vii. It settles disputes among its members

FUNCTIONS OF EMPLOYERS ASSOCIATION

i. They provide standards of safety for workers

ii. They establish satisfactory terms and conditions of employment

iii. They also ensure health and welfare of workers

iv. They maintain standard and ensure that terms and conditions in the contract of employment are

obeyed by the employers and employees

v. They collaborate with trade unions in settling disputes between employers and employees

CARTEL

A cartel is a monopolistic type of organisation established originally by producers of similar products

for the main purpose of restricting output of members in order to keep up the price of their

products. It is an association of independent produces formed mainly for the main purpose of

regulating process by controlling output. Members of a cartel retain their separate identity and are

independent e.g OPEC (Organisation of Petroleum Exporting Countries)

FEATURES OF A CARTEL

i. Cartel is monopolistic in nature

ii. It is established by independent producers of similar product

iii. They allocate quotas to members

iv. They restrict output so as to force the price up

v. Competition is removed

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REASONS FOR FORMING CARTEL

i. To keep up the price of their products

ii. To ensure higher profit for members

iii. To reduce waste by eliminating competition

iv. To regulate output

TRUST

This is an amalgamation of different competing firms in different lines of businesses under a single

control. In trust, the firm will retain their identity but the trustee will take over the management and

control. It is vertically integrated in nature and the amalgamated firms are brought under a central

control. Certificates will be issued to all members. Trust has its origin in America

DIFFERENCE BETWEEN CARTEL AND TRUST

TRUST CARTEL

Members will lose their independence Members will still maintain their independence

Trust is a complete merger It is voluntary and members can withdraw

It has a vertical structure It is horizontal in structure

Certificates are issued No certificates is issued

There is no quota system Producers are given quota

CONSORTIUM

A consortium is a group of independent firms formed to work on a particular project which requires

large resources and is too complex for a single firm to undertake. A consortium is also an association

of firms that pool their resources together to finance a project they cannot embark upon individually

because of its complexity or the capital outlay. A very good example is the consortium of banks that

gave loan to African Independent Television (AIT)

REASONS FOR FORMING A CONSORTIUM

i. To finance a project that requires large capital outlay

ii. When the project is complex in nature

OTHER FORMS OF INDUSTRIAL COMBINATIONS

i. HOLDING COMPANY: In holding, one company acquires the whole or a large proportion of the

issued share capital of other companies with the objective of actively controlling such companies. A

holding company is purely a financial concern which uses its capital to acquire controlling interest of

over 51% in other firms. The parent company is called holding company while others whose shares

are being acquired are its subsidiaries. The subsidiary companies will retain their identities and

names

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ii. PRICE RINGS: Price rings is an association of a member of competing firms who have agreed to

operate a common price policy for their competing products. Price rings advocated uniform price

but allows competition among the firms. The firms are loosely associated together

iii. SYNDICATE: Syndicate is an association of organisations who work together for a common aim

while retaining their independence. It is voluntary e.g underwriters at Lloyds work in syndicates

iv. MERGER/AMALGAMATION: Merger is the combination or coming together of two or more

previously independent firms to form one large firm. It is the unification of two or more

organisations to form a new one. The old firms will lose their identity in the new organisation while

the new firm can take a new name or adopt a combination of names of the old firms. Merger may

arise from the desire to diversify or to buy out a competitor.

REASONS FOR MERGER

i. For larger market share: To obtain a larger share of the total market

ii. Advantage of economies of scale: To enjoy economies associated with large scale production

which will reduce unit costs and increase profit

iii. Efficiency: To increase efficiency of management where the acquired company is poorly managed

iv. Diversification: To diversify the activities of the firms into other areas

v. Elimination of competition: Firms may merge in order to check or eliminate competition

vi. Financial stability: To ensure greater financial stability through internal growth

vii. To reduce cost: To reduce the overhead cost by eliminating duplication of facilities

viii. To obtain raw materials: Firms may merge in order to obtain raw materials from direct source

FORMS OF MERGER

Merger can be vertical or horizontal. Vertical amalgamation is the coming together of firms at

different stages of the production process. It is therefore a method of linking the various stage of

production from the raw material stage to the finished products e.g an amalgamation of firm

producing cotton with a textile firm whereas horizontal amalgamation is the coming together of

different firms at the same stage of the production process, it occurs when firms producing similar

goods come together at the same stage of production process. This shows the extent to which firms

in the same stage of production in an industry come under some unified control e.g merger of two

pharmaceutical firms or banks

TRANSPORTATION

Transportation is one of the aids to trade. It is the process of conveying goods and people from one

place to another either through water, road, rail or air. It is simply the movement of goods and

people from one place to another

IMPORTANCE OF TRANSPORTATION

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i. WIDENING OF THE FIRM’S MARKET: Transportation has the ability to extend a firm’s market for

the sales of the firm’s product. It aids the movement of people and goods to the interior, thereby

widening its market

ii. ENCOURAGMENT OF INTERNATIONAL TRADE: The development of transport by air and sea has

greatly promoted and encouraged trading activities between one country and another

iii. EFFECTIVE AND EFFICIENT DISTRIBUTION OF GOODS: Transportation facilitates and quickens the

effective distribution of goods and services to areas where they are needed

iv. PREVENTION OF WASTAGE OF PERISHABLE GOODS: A good and effective transport system will

ensure quick distribution of perishable goods to areas where they are needed and therefore prevent

wastages

v. MOVEMENT OF PRODUCTIVE RESOURCES: A good transport system will help in moving

productive resources from areas where they are available to areas where they can be put to

adequate use

vi. DEVELOPMENT OF SPECIALISATION: Improved means of transport is an essential ingredient in

the development of division of labour and specialisation which makes mass production possible

vii. IMPROVED STANDARD OF LIVING: Transportation helps to make goods and services available at

the right time and right place and thus helps to improve standard of living of the people. It has also

led to economic growth and development in Nigeria and other countries of the West African sub

region

viii. DEVELOPMENT OF RURAL AREAS: Transportation has greatly encouraged the development and

growth of the rural areas of a country

ix. MOVEMENT OF GOODS AND PERSONS: Transport facilitates the movement of goods and

persons from one place to another

x. IT INFLUENCES THE LOCATION OF INDUSTRIES: The existence of good transport network do help

in the location of industries

xi. EMPLOYMENT OPPORTUNITY: All means of transportation employs lots of people thereby

enabling them to earn a living

FACTORS DETERMINING CHOICE OF TRANSPORTATION

i. NATURE/TYPE OF GOODS: The nature of the goods to be transported will determine the means of

transportation to be used. Perishable and fragile goods for example are better handled by fast

means of transportation like aircraft while heavy and bulky goods are better handled by ship or rail

ii. COST OF TRANSPORTATION: The overall cost of transport does determine the choice of means of

transportation of goods. Air transport is costly while rail is cheap over a long distance and this will

determine the choice of either of the two to use

iii. THE VALUE OF THE GOODS: Commodities with high unit value like jewelleries are better

transported by air so as to reduce pilferage

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iv. AVAILABILITY: The choice of transport can also be determined by the type of transportation

available in the area. In the riverine areas e.g Niger Delta in Nigeria, the best means of transportation

is through water

v. SPEED/URGENCY: The speed of the means of transportation will be considered. It will better to

send goods that are needed urgently through the fastest means and when not urgent

vi. DISTANCE/DESTINATION: When the distance is long, the best means of transportation are water

and air, irrespective of the cost while road transportation is good over short distance

vii. CONSUMERS PREFERENCE/ CONVENIENCE: The choice of the consumer will go a long way to

determine the means of transportation to be used. Rich consumers would prefer air even for items

that can go by road.

FORMS OF TRANSPORT

There are four major forms of transport namely; land, water, air and pipeline

TRANSPORT BY LAND

Transport by land is the means of conveying goods and passengers from one place to another

through land. This means of transportation is very good for trading within a country i.e home trade.

Land transport can be divided into road and rail transport

ROAD TRANSPORT: Road transport is the movement of goods and passengers on road by motor

vehicles, buses, trailers, cars, motorcycles, bicycles, tricycles etc. It is the most extensively used of all

the means of transportation. In order to be efficient, there must be well constructed road network

linking different villages and towns together. There should also be some trans-highways linking

countries

ADVANTAGES OF ROAD TRANSPORT

i. Low maintenance cost: The cost of maintaining motor vehicles is low compared to aeroplanes or

ships

ii. Faster on short journey: Road transport is faster on short distance journey e.g Lagos to Ibadan. It

is relatively a fast means of transportation

iii. Flexible: There is high degree of flexibility since there is no fixed time schedule

iv. Convenience: Goods are delivered at the door of the consumer i.e it offers door-to-door services

which makes it convenient for the owners of the goods

v. Suitable for perishable goods: Road transport is good for conveying perishable goods e.g

tomatoes as it is fast and easily accessible

vi. Availability: The means of transportation by road are always readily available for use e.g car,

trailer tanker among others

vii. Serves as an advertising outlet: It can serve as an advertising outlet as people print and paste

adverts or logo on cars etc

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x. It is cheap: Transportation by road is cheap over short distance and prices can be negotiated

DISADVANTAGES OF ROAD TRANSPORT

i. Not suitable for fragile goods, heavy and bulky goods: Road transport is not good for conveying

fragile goods, heavy and bulky goods like glass plates, machinery and coal

ii Slow on long distance: It is slow when long distance is involved iii. Slow on long distance: It is slow

when long distance is involved

iv. Prone to accident: Road transport is too prone to accident than other means of transport

v. Costly to transport bulky material: It is very costly to transport bulky material by road e.g

machinery

vi. Welfare facilities are not provided: Facilities such as toilet, canteen and television are not usually

provided in road transport as these are available in trains, water and air transport

vii. Poor weather conditions: Poor weather condition may affect the movement of vehicles

viii. Delay free movement: Traffic jams and hold-ups can delay free movement

ix. Prone to armed robbery: Transportation by road is prone to armed robbery attacks

REASONS WHY ROAD IS PREFERRED TO RAIL

i. Maintenance is cheaper than rail

ii. It offers door-to-door services

iii. It is faster than rail on short distance

iv. It is more flexible as it does not travel on time schedule

v. Road transport can help to easily collect goods from the interior

vi. Road transport is good for perishable goods

vii. It is available in varieties

RAIL TRANSPORT: Rail transport is the means of conveying goods and passengers from one place to

another by train. Heavy and bulky goods are carried by train. A train cannot move on ordinary road

but has special routes. It moves on iron tracks known as railway line. In Nigeria, the Nigerian Railway

Corporation manages the rail system.

Two types of trains can easily be identified. These are the passenger train and the goods train.

The Passenger Train is used for carrying passengers from one place to another. A train has first,

second and third class compartments. There is a considerable improvement in the services provided

by the present day rail system. Television and canteen services have been introduced in recent times

The Goods Train is used for conveying goods within the country. They can carry large amount of

heavy and bulky goods e.g agricultural products, minerals, vehicle’s spare parts and metals

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ADVANTAGES OF RAIL SYSTEM

i. Suitable for heavy and bulky goods over long distance: The rail system is good for large

consignment of heavy and bulky over long distance

ii. Standard rate of charges: Goods are weighed and charged at standardised rates

iii. Special trains may be arranged to suit goods

iv. It is very cheap: This is the cheapest means of transportation

v. High capacity: Train carry more passengers/goods than motor vehicles

vi. Less prone to accident: It is less prone accidents and highway robbery

vii. No traffic hold-up: Routes are usually direct and not affected by traffic hold-up

viii. Train operates on schedule: Rail transport is run on schedule

ix. Provision of welfare services: In rail transport, passengers can enjoy toilet facilities, canteen

services, television programmes, video and film show etc

DISADVANTAGES OF RAIL TRANSPORT

i. It is not flexible: The operations of the rail system is not flexible because fixed routes and set time-

tables do inconvenience users

ii. High cost of operation/ Huge Capital outlay: The cost of purchasing, constructing and maintaining

the train and its track is very high

iii. Not suitable for perishable goods: Rail system is not suitable for perishable goods e.g tomatoes.

This is because rail system is too slow

iv. It is expensive on short distance: It is expensive on short distances because of its fixed charges

v. There is much delay: Trains stop at almost all stations and this causes delay

vi. Additional handling: Additional handling or transhipment is needed before goods reach their

destination

REASONS WHY RAIL IS PREFERRED TO ROAD

i. Rail is good on long distances

ii. Accident is not common unlike road

iii. It is good for carrying bulky goods

iv. Standard rates are charged

v. Entertainment and refreshment services are provided

TRANSPORT BY PIPELINE

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Transport by pipeline is a system of transporting gases and liquid products from one place to

another through the use of pipelines. Pipelines are constructed or laid underground as means of

carrying water, gases and petroleum products. In Nigeria, pipeline are constructed to transport

crude oil from Warri to Kaduna refinery

ADVANTAGES OF TRANSPORT BY PIPELINE

i. Low maintenance cost: It is cheap because of low maintenance cost

ii. Safe: Since pipes are laid underground, there is less possibility of accident

iii. Continuous flow of goods: Goods are moved over a long distance without obstruction as it is not

affected by traffic jam

iv. Reduce the overcrowding of the roads: The number of tankers carrying liquids and gases will be

greatly reduced on the road

v. Not easily affected by climate change: The climatic condition may not affect pipelines easily

DISADVANTAGES OF PIPELINE TRANSPORT

i. Prone to leakages and unauthorised tapping: Pipeline transportation can be prone to leakages and

unauthorised tapping by the people as is the case in the Niger Delta

ii. High cost of construction: The cost of constructing pipelines is very high. A lot of money would be

expended on laying the pipes

iii. Easily damaged: Pipeline can be easily damaged during road construction which can lead to

wastages

iv. Limited in scope: It is only limited to liquid goods alone e.g water. Solid goods cannot be

transported by pipeline

v. It is vulnerable to climate change: Climatic changes i.e weather can damage the pipeline. Wears

and tears can cause the pipeline to rot, leading to product leakage

vi. Only a single product can be moved: It can only be used to transport a single product moving

towards one direction at a time

vii. Routes are fixed: Routes for pipeline are fixed and tend to be concentrated regionally

viii. Slow speed: Liquid transported move through pipeline at a leisurely slow speed

TRANSPORT BY AIR

Transport by air is the system of moving goods and passengers through the air by aeroplanes,

helicopters etc. Air transport is very fast and comfortable but it is expensive. Air transport has

contributed greatly to commercial activities in international trade. Some airlines operating in Nigeria

are Air Peace, Arik Air, Dana Air etc. Transportation by air is operated in the airport. Examples of

airports in Nigeria are Lagos, Abuja, Kano and Port Harcourt international airports

ADVANTAGES OF AIR TRANSPORT

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i. It is very fast: The speed is very high, hence it is the fastest means of transportation

ii. Suitable for perishable and fragile goods: Air transport is most suitable for perishable, expensive

and fragile items as the danger of damage is reduced to the barest minimum

iii. Comfortable and luxurious: This is by far the most comfortable and luxurious means of

transportation hence it is suitable for long distance

iv. Reduced cost of insuring goods: The cost of insuring goods conveyed by air is reduced because

the shorter the time the insurance company is at risk

v. Pilfering is reduced: Since there is less handing of goods transported by air pilfering is reduced

vi. Extension of market: Markets are extended as distant markets are reached in matters of minutes

or hours

vii. Powerful instrument of war: Air transport is used for warfare and it is very effective as was

demonstrated in the Operation Desert Storm by the US against Iraq in 1990

viii. Its costs nothing to provide or maintain air routes

ix. Minimal rate of accidents: The rate of accidents in air transport is very minimal

DISADVANTAGES OF AIR TRANSPORT

i. Expensive: The cost of air fare or charges and freight is expensive when compared to other forms

of transport

ii. It is vulnerable to climatic changes: It is subject to high degree of risk as the weather may disrupt

flight and landing hence it is limited by weather conditions

iii. It is not flexible: Since it travels on schedule and fixed there is high degree of inflexibility

iv. Unsuitable for heavy and bulky goods: The weight of the goods carried is limited as it is not good

for moving bulky and heavy goods like machinery

v. High operational cost/Capital intensive: The cost of buying and maintaining aircraft together with

landing facilities is very expensive

vi. Accidents are fatal: When accident occurs, it is always very fatal. All the passengers on board are

most likely to lose their lives when it crashes

vii. It requires supplementary means of transportation: Air transport cannot land anywhere except

the airport, hence other means of transportation such as taxi, must be involved to supplement its

operation

viii. Arrival and departure procedures are cumbersome

TRANSPORT BY WATER

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Water transport is the means of conveying goods and people from one place to another through the

rivers, seas or ocean by ship, canoes etc. This facilitates international trade between different

nations because goods and passengers can be easily transferred

TYPES OF WATER TRANSPORT

1. INLAND WATER TRANSPORT: This is a type of water transport in which goods and people are

moved from one place to another through the rivers, canals, creeks and lakes. This type of water

transport operates within a nation’s boarder. The river must be navigable e.g River Niger and River

Benue. Boats, launches, canoes and ferry are some of the means of transportation in inland

transport

2. SEA TRANSPORT: Sea transport ensures that cargoes and people are moved from one country to

another. This is associated with sea and oceans. Since one port is connected to another, it aids

international trade. Seaport is a point or place along the coast where ship and canoe normally stay

or take off into the sea or ocean.

The various means of transportation by sea are ocean liners (passenger cargo), tramp liners, coaster

liners and special purpose ship

i. OCEAN LINERS: Ocean liners sail through the high seas and oceans in all the continents of the

world e.g Atlantic, Indian and Pacific oceans. It is divided into passenger liners and cargo liners

a. Passenger Liners: Passenger liners are ocean liners which convey passengers from one place to

another on a definite of specific route. Passenger liners normally move on schedule timetable. They

are luxurious, thereby passengers derive maximum pleasure. They can also be used to carry mails

b. Cargo Liners: Cargo liners are ships which carry heavy and bulky goods from one place to another

on the high seas and oceans. Cargo liners operate on specific timetable and they normally run on

definite routes. They can also carry few passengers

CHARACTERISTICS OF OCEAN LINERS

i. Ocean liners act as passenger liners, passenger-cargo liners and cargo liners ranging from say

10,000 to 50,000 gross tonnages or more

ii. They maintain a regular service i.e at advertised times between specific ports and at scheduled

freight charges

iii. Their freight charges are normally fixed by the shipping companies themselves

iv. Cargoes may vary from comparatively small but valuable cargoes to the more bulky cargoes of

the cargo liners

ii. TRAMP LINERS: Tramp liners carry cargoes where they are found and leave when there are

sufficient cargoes. Tramp liners have no fixed timetable and do not run along specific routes. They

are available for general hire hence are referred to as cargo water taxis.

CHARACTERISTICS OF TRAMP LINERS

i. They are sometimes described as unspecialised general purpose ships

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ii. Tramp vessels have no fixed routes or scheduled sailing times

iii. Tramp shipping rates are usually fixed

iv. They do not carry cargoes in parcels but prefer to deal with bulk cargoes

v. Tramp vessels are frequently importers of exporters on either a time or voyage charter

vi. Some of the smaller tramps are particularly useful for visiting small, inadequately equipped ports

to collect cargoes of timber, ore etc

vii. They operate as sea taxis

DIFFERENCE BETWEEN TRAMP LINERS AND OCEAN LINERS

TRAMP LINERS OCEAN LINERS

They have no specific routes They have specific routes

They have no fixed timetable They operate on specific timetable

They have no fixed rate of charges They charge standard rate

They may not be luxurious Passenger liners are luxurious

They handle only cargoes They handle cargoes and passengers

They are available for general hire They are booked in advance

iii. COASTER LINERS: Coaster liners are flat bottom steamers that are used to convey goods along

the coast to the main port. They can go through the creeks and rivers easily. Sometimes they are

referred to as lighters and tugs. Coaster liners are good for carrying raw materials for firms

iv. SPECIAL PURPOSE SHIPS: Special purpose ships are specially built for particular cargoes. For

instance, in conveying crude oil, specially built tanker ship are used

ADVANTAGES OF WATER TRANSPORT

i. Suitable for bulky goods: Ships are used for carrying heavy and bulky goods e.g heavy machinery

from one country to another

ii. It is safe: Water transport is very safe for carrying goods and passengers as cases of accidents are

rare

iii. May be suitable for perishable goods: Ship contain refrigerators which can preserve perishable

goods e.g fish from being spoilt

iv. It aids international trade: Sea transport greatly aids international trade because goods can be

moved from one country to another

v. Operate on schedule: Some liners run on schedule and have specific routes e.g River Niger and

Atlantic route

vi. It is very cheap: Water transport is very cheap as heavy goods are carried over a long distance e.g

Nigeria to New York with very cheap charges

vii. Routes are not costly: The routes cost nothing because they are natural gift of God

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DISADVANTAGES OF WATER TRANSPORT

i. Slow over long distance: Sea transport is very slow over long distance. A ship can sail from Nigeria

to New York for more than three months

ii. It is expensive to maintain a ship: The cost of maintaining a ship is very high

iii. Limited in scope: Water transport is limited to areas where there are water; rivers, lakes, creeks,

oceans or seas

iv. It is prone to perils of sea: Sea transport is prone to perils of sea like storm, collision and tempest

v. High cost of constructing ports: The cost of constructing and maintaining seaport is very high

vi. Operations must be supplemented by other means of transportation: Sea transport requires

other means of transportation to supplement delivery of goods

CARRIER

A carrier is a firm or organisation that specialises in transporting other people’s goods. Carriers can

be classified into three; private carrier, common carrier and contract carrier

a. COMMON CARRIER: A common carrier is a person or firm who undertakes to transport goods

from one place to another for anyone willing to pay a reasonable charge. They are open to the

generality of the people. A common carrier is obliged by law to carry the goods safely and is liable

for damage or loss of the goods. Examples of common carriers are motor vehicles that operate on

the highways

FUNCTIONS OF A COMMON CARRIER

i. The goods must be delivered to their destination

ii. The carrier will be liable for loss or damage to the goods

iii. The carrier is obliged by law to carry the goods safely and securely

b. CONTRACT CARRIER: Contract carrier is a public carrier which undertakes to transport goods from

one place t another under contract e.g tanker fleets that transport oil to the oil depot

c. PRIVATE CARRIER: Private carrier helps to move his or its own goods from one place to another.

For instance, a company car can be used to carry their product about

CONTAINERIZATION

Containerization is a method of freight handling in which general cargo is packed into large

rectangular containers and carried in this form from a factory or inland depot by lorry to a port. In

other words, it is the use of sealed large metal boxes for transporting goods. Containers are large

rectangular crates which are used to pack cargoes from a factory of inland depot by lorry to a port.

The containers are loaded onto the ship or plane by a machine called crane

USES OF CONTAINERS

i. To reduce Pilferage: Pilferage of goods can be reduced since the containers are sealed

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ii. Quickens loading: It increases the speed of loading of goods into a ship

iii. Easy movement: It can be easily moved to their destination without being unpacked

iv. Protection: The goods can be protected by the use of containers against fire, bad weather etc

v. Cost reduction: The use of containers reduce cost of loading and offloading of goods because

they are packed in containers

CHARTER PARTY

Charter party is a contract whereby a ship or aircraft is temporarily leased by the owner to another

person or firm purposely to transport cargoes from one place to another. The charterer must pay

charges called charter party freight. It may be for a definite journey or definite period. The name of

the ship, its destination and freight must be specified

TYPES OF CHARTER

a. TIME CHARTER: Time charter is the hiring of a ship for an agreed period rather than hiring for a

particular voyage. The ship is chartered for a specific period e.g five months

b. VOYAGE CHARTER: Voyage charter is a contract whereby the owner of a ship hires it out for a

specified voyage rather than for a fixed period

DOCUMENTS INVOLVED IN TRANSPORTATION

CONSIGNMENT NOTE: Consignment note is a document made out by the sender of goods handed to

the carrier and countersigned by the consignee on delivery as proof that delivery has been made

BILL OF LADING: A bill of lading is a document that gives the holder the right to acquire possession

of goods that have been shipped. This is a contract between the exporter and the shipping company

stating the terms under which the goods are to be exported. It shows the name of the vessel, the

port of destination and the rate of freight

CERTIFICATE OF INSURANCE: Certificate of insurance is a document which shows that the goods

have been insured against risks or loss by the exporter

AIR WAY BILL: Air way bill is a document made out by the consignor of goods to be transported by

air. It shows the names of consignor and consignee, the airports of loading and the value of the

goods

MANIFEST: Manifest is a document which shows the full list of the cargo carried by a ship or aircraft.

This document is to be completed by the captain of the ship and lodged with the custom authorities,

showing the particulars of the ship, its cargo and destination

SHIPPING NOTE: Shipping note is a document containing instructions for transporting the goods. It

is sent to the shipping agent by the exporter

DELIVERY NOTE: Delivery note is a document which normally accompanies the delivery of goods. It

shows the goods delivered and checks to be made

TERMINOLOGIES USED IN THE TRANSPORTATION INDUSTRY

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1. FREIGHT: Freight is the term used for the cost of shipping a particular cargo for a specific voyage

2. DEAD FREIGHT: Dead freight is the freight paid on unoccupied space in the ship. If there is empty

space left in the ship, the person that charter must pay for the space not used

3. CHARTERER: A charterer is the person or firm that hires or charters a ship for a specific purpose

4. CONSIGNMENT: Consignment are goods that are conveyed from one place to another; a shipment

or delivery of goods

5. CONSIGNEE: Consignee is the person or organisation to which goods are transported to through a

carrier

6. CONSIGNOR: Consignor is the owner who sends goods to the consignee

7. DEMURRAGE: Demurrage is an extra charge or penalty which the charterer pays for exceeding the

period originally agreed upon. It is used in connection with charter party. Demurrage is normally

calculated as a certain charge for each day a performance is delayed. It is the charge paid for failing

to off-load a ship within a stipulated time

8. DEMISE CHARTER: Demise charter is a form of charter party where the charterer of a ship makes

all the arrangements for working it, so on effect for a period it is owned by him, i.e the period of

charter

9. LAY DAYS: This is the stipulated days allowed by the charter for loading or unloading of cargo

from a ship. If it exceeds then demurrage will be paid

COMMUNICATION

Communication is the process of exchange or transmission of meaningful information, feelings,

opinions and ideas from one person to another or from one place to another. It is a two-way process

which involves sending and receiving of messages. Communication is a vital aspect of commerce

because it is the means by which buyers and sellers are able to get in contact to transact business.

IMPORTANCE OF COMMUNICATION

i. Promotion of commercial activities: Communication promotes commercial activities as the whole

world is connected together as a global village

ii. Enhance settlement of international indebtedness: The use of telecommunication has enhanced

the settlement of debts through telegraphic money transfer, e.g Western Union Money Transfer

iii. Creation of awareness for goods and services: Communication helps in creating awareness for

goods and services in order to induce customers to buy

iv. Reduction in cost and risk of travelling: Through communication, the cost and risk involved in

travelling long distances for business transaction can be greatly reduced

v. Facilitates contact between businessmen: It provides and facilitates good and efficient means of

maintaining close contact between businessmen

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vi. Communication enhances international trade: Foreign trade transactions can be facilitated

through modern means of communication as various markets are linked together

vii. Facilitates Mail Order business: The use of postal system has greatly enhanced mail order

business

viii. Provides information for government policies: Information about the economic and commercial

policies of a government are transmitted through communication to the businessmen

ix. Enhances air and sea transport: Transportation by air and sea are made possible by

communication. The use of radio, telegram and other means have made contact between a ship off

shore and the port possible

x. Good and fast means of spreading information: Communication facilitates the dissemination of

information about the market situation of goods and services

xi. Ensures quick and fast delivery of documents: Documents and parcels are easily, quickly and

safely moved from one place to another

FUNCTIONS OF COMMUNICATION

1. Information: It is used to pass messages across businesses and individuals

2. Communication helps to convey commands or instructions to subordinates

3. It is used to disseminate policies within an organisation

4. Feedback function: This is carried out as a response to the information earlier sent out

5. Influence: It is used to influence performance or non performance of an action

6. It facilitates mail order business and e-commerce

DEVELOPMENT AND MEANS OF COMMUNICATION IN NIGERIA

In Nigeria, the earliest means of communication is the human voice. Communication then was based

on the level of development at the time. Many other means of sending and receiving messages have

been developed over the years

TRADITIONAL MEDIA OF COMMUNICATION

i. Wooden/Talking drums: Wooden drums are used to pass messages to the people within the

community. The beating of the drum will produce different sounds for different messages. The head

of the community can use it to assemble his people in a place. Drums are made from wood

ii. Town criers: Messages can be transmitted through town criers. These are people that pass

information from one place to another on foot or horse back. They use different instruments to

draw people’s attention

iii. Metal gong: This is a hollow metal beaten with another metal to make announcement to

members of a traditional community. On hearing the sound, people will gather at the village square

to hear or discuss the latest development in the community

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iv. Palm frond: This is a means of communication which signifies peace during a period of chaos

v. Smoke signal: By setting bushes on fire, the smoke can be used as a means of communication.

Whoever sees the smoke signal will know that something is happening

vi. Gun blast: Gun shots are used to mark or signify traditional festivals and burials in some African

communities. Humans also used gun shots for communication purposes during hunting expedition

vii. Others are whistles, bells, trumpets, drum and flutes

TYPES AND FORMS OF COMMUNICATION

1. WRITTEN COMMUNICATION: This occurs when people communicate in written forms through

letters, memos, articles, emails etic. It can be hand written or typed. This is the application of a

group of alphabetical symbols of the language chosen to convey the message to the receiver. It

provides permanent records as information are documented

ADVANTAGES OF WRITTEN COMMUNICATION

i. Written communication provides permanent records

ii. It removes the necessity of personal contact

iii. The receiver can read the message as often as he wants

iv. It is more reliable than oral communication

v. Provides recorded precedent, which can be used in the law court

DISADVANTAGES OF WRITTEN COMMUNICATION

i. It takes time to prepare

ii. It can be expensive to produce written message

iii. It creates maintenance problem in terms of space as bulky files and pile of paper are used

iv. Sender is not sure whether his message has been received or not

2. ORAL/VERBAL COMMUNICATION: This occurs when people communicate with the use of speech

to express the message or information to others. It could be in spoken language, face to face or over

an electronic medium. It could be personal or interpersonal

ADVANTAGES OF ORAL COMMUNICATION

i. It is very fast

ii. Provides immediate feed back

iii. Easier to maintain secrecy

iv. It costs little money

DISADVANTAGES OF ORAL COMMUNICATION

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i. It consumes precious time

ii. Lacks aid to human memory

iii. It can be distorted or misunderstood

3. NON-VERBAL COMMUNICATION: This is a method of communication without using words. it

employs the use of signs and body gestures to convey messages such as folded arms, legs, shaking

heads, facial expressions to signify acceptance.

ADVANTAGES OF NON-VERBAL COMMUNICATION

i. It saves time

ii. It solves the problem of linguistic

iii. It makes verbal communication more effective by supporting it with visual stimuli

DISADVANTAGES OF NON-VERBAL COMMUNICATION

i. Only simple and limited message can be sent

ii. This form of communication can be easily misunderstood

iii. It is expensive when photographic films are used

4. VISUAL COMMUNICATION: This is a form of communication which involves the display of

information with the help of visual aids such as road signs, maps, posters, banners, and neon signs.

It involves the use of sense of sight (or eyes) only in disseminat information. Common means of

visual communication involves the use of television, film show etc

ADVANTAGES OF VISUAL COMMUNICATION

i. It can reach many people at fixed and time

ii. The information can be stored

iii. It does not waste time

iv. It can also be useful to the deaf but literate people

DISADVANTAGES OF VISUAL COMMUNICATION

i. It may be expensive to operate e.g television

ii. The information can only reach the wealthy and literate members of the society

iii. Questions cannot be asked on matters been discussed in television etc

COMMUNICATION NETWORKS OR ELEMENT IN NIGERIA

The major communication networks or elements in Nigeria are;

i. Telecommunication: This involves the use of telephone services, cellular phones, voice mails etc

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ii. Postal services

iii. Television

iv. Radio

v. Newspapers

vi. Internet

vii. Satellite

viii. Courier services

TELECOMMUNICATION: Telecommunication is the technology used in sending signals, images and

messages over long distance by telephone and satellite

NIGERIAN TELECOMMUNICATION LIMITED (NITEL)

The Nigerian Telecommunication Limited was established to provide the following services;

telephone, telex, telegram and satellite etc. As a result of the privatization policy of the government,

NITEL has been sold to Transcorp plc

a. TELEPHONE SERVICES: This service enables businessmen and others to send verbal messages

across to their customers and relations instantly wherever they may be in the whole world. The

various types of telephone services are;

i. Private business exchange (PBE): This facility is provided for big organisations like hospitals,

universities or companies with many telephone extensions. A switchboard to be manned by an

operator will be installed to enable communication to be made to people within and outside the

organisation

ii. Subscriber trunk dialling (SIT): This is trunk call which is automatically connected to the metre of a

subscriber. A switchboard operator is not needed

iii. Private telephone lines: Individuals can apply for private telephone lines and they will be linked up

directly through the use of telephone boxes

iv. Telephone directories: This document contains the names, numbers and addresses of all

subscribers

v. International subscribers dialling (ISD): This provides facilities for international telephone services

among people in different countries of the world

vi. Radiophone: This is a mobile radiotelephone service which is used in vehicles and it has limit as to

areas where it can be used. It is limited to certain areas

vii. Public telephone booth: The firm will erect phone booths at different locations and users can

make calls by slotting in cards or cash

b. TELEGRAM SERVICES: These are messages sent by telegraph and then printed and given to

somebody. It enables written messages to be sent quickly from one place to another. It is more

costly than the normal telephone service

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c. TELEX SERVICES: This is a service which enables users to transmit and receive printed messages

over telecom line. It makes use of teleprinters to send messages from one subscriber to another at

any time of the day or night even after an office has closed. Users must be telex subscribers with

their own equipment and code

d. FAX SERVICES: This involves the transmission of data of exact duplicate copies of the documents.

The original document is fed into the fax machine which reads it and coverts it into electronic form

so that it can be transmitted over the telecommunication line. The recipient can print the message

using fax machine

e. GLOBAL SYSTEM OF MOBILE TELECOMMUNICATION: NITEL provides mobile telecommunication

services through Mtel. Other companies providing GSM services are MTN, Globacom, Airtel and

9mobile. Mobile services include the following;

i. Message services such as short message services and voice mail

ii. Call hanging services such as conference call or call diverts

iii. Corporate services such as integrated numbering so that people can have a single contact

number for both the phone on their desk and their mobile handsets

f. TRANSMISSION THROUGH SATELLITE: NITEL provides satellite for live transmission of events

NIGERIAN POSTAL SERVICE (NIPOST): The Nigerian Postal Services (NIPOST) is an extra-ministerial

department under the Ministry of Communication. The first post office in Nigeria was established in

1856 in Lagos. It was charged with the responsibility of ensuring proper handling of mails. Now, post

offices are located in all major towns and cities in Nigeria. NIPOST renders both postal and payment

services to the public

SERVICES RENDERED BY POST OFFICE/POSTAL SERVICES

i. ORDINARY MAIL/ LETTERS: It costs less to post but has a weight limit. When it weighs more an

extra charge in postage in paid. In the event of loss, the post office does not pay any compensation

to the sender. Valuable items are not sent through ordinary mail. It takes longer time to get to its

destination. Ordinary mails include first class and second class mails. Before a letter can be delivered,

stamps must be affixed on it. Letters may be official or personal and can be sent by air, land or sea

ii. PARCEL POST: Parcel sent through the post are weighed and charged accordingly. They would go

by ordinary mail or be registered if they contained valuable items. When parcels are registered, their

owners can claim compensation if there is a loss. It ensures that parcels are handed to the post

office for onward transmission from one person (sender) to another. They are weighed in order to

determine the appropriate charges.

iii. REGISTERED MAIL/POST: This is a safe way of sending valuable items/articles through the post

office. It costs more than ordinary mail. It is not put into the posting box. It is handed over to an

official of the post office. A receipt is issued to cover a registered mail. In the event of loss the

sender is entitled to compensation when he provides the receipt of posting. Registered letters have

lines drawn at the back horizontally and vertically across the envelope. The person to whom it is sent

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will be given a notification slip that will enable him claim the letter and compensation will be paid if it

is lost

iv. EXPRESS DELIVERY: It is fast and quick means of sending letters and parcels through the post

office. It attracts extra charge. Arrangement is made to deliver the letter to the addresses when it

reaches its destination.

v. PRIVATE MAIL BAGS AND BOXES: Provision of these allows owners to personally collect their

letters at convenient times. The boxes and bags are locked at the post office in order to ensure

security and privacy to letters. An annual rental fee is charges. These services are rendered to

people by renting out a box or bag at the post office to the people. Letters belonging to owners of

these boxes and bags are sorted out and kept in the box or bag. The users of the boxes or bags are

given keys to unlock their boxes or bags to collect mails anytime. Those using private mail bags are

provided with bags each for which their letters are kept inside well padlocked and the key given to

the customer.

vi. BUSINESS REPLY SERVICE: These facilities are rendered to the specific businessman who has

applied in advance. It enables the public to reply to business advertisements without paying for

postage stamps. The post office issues licenses to firms that require this service. The business or the

licensee pays the charge in advance. The firm would have supplied their self-addressed envelopes or

cards which will be used for reply. The firm acquires a licence after paying an annual fee to cover the

cost of postage which is based on the number of replies received

vii. LICENCING OF FRANKING MACHINE(POSTAGE METRE): This is provided by the post office to

frank letters instead of using postage stamps. This service is possible when a company with large

customers receive franking machine under licence from the post office in order to stamp or frank its

own mail with postage impression. The machine will automatically record the number of franked

mails in its metre. This saves time and the energy that would be expended when using stamp for

many mails. The firm pays advance charges to the post office

viii. POST RESTANTE: The post office provides this service to travellers or tourists that are visiting

another town with no fixed address. They will enter into agreement with the post office so that their

mails will be addressed to the post office. The mail must be marked ‘Post Restante’. The individual

involved must provide evidence of his identity when calling to receive his mail from the post office

ix. RECORDED DELIVERY: This is a means of sending important documents through the post office.

Certificate of posting is issued to sender. The person to whom it is sent signs as evidence of receipt.

It attracts extra charge. This is a service provided by the post office to enable the person sending to

have a proof of delivery.

PAYMENT SERVICES

i. POSTAL ORDER: This is a means of payment provided by the post office to transfer small sums of

money by post to ensure payment or to settle debts. Postal orders are valid for six months and

commission called poundage are paid to the post office. Postal orders are in various denominations

and are not negotiable

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ii. MONEY ORDER: This service ensures that large amount of money is sent through the post office.

Money order is safer than postal order. It is an order made by one post office to another specified

post office for payment of a specified sum of money on demand to a named person

iii. CASH ON DELIVERY SERVICES: This is a service provided by the post office which ensures that

businessmen can collect money on the delivery of parcel. It is good for mail order business; the post

office will collect money on delivery and remit to the supplier

iv. SALES OF STAMPS: NIPOST sells postage stamps of different denominations to their customers

v. SETTLEMENT OF PAYMENT: It is also used occasionally to settle small amount of payments by

post for items such as catalogue

FUNCTIONS OF POST OFFICE

i. Inland and overseas services: For a fee the Post office undertakes to deliver letters to both home

and aboard

ii. Recorded delivery services iii. Registered letters iv. Sales of Stamp

v. Post Restante Service vi. Express Delivery/Expedited mail service

vii. Postal/money order viii. Agency services ix. Business reply services

x. Provision of private mail bags and boxes xi. Cash on delivery xii. Banking services

xiii. Franking machines(postage metre)

MASS MEDIA: Mass media involve the transmission of information through special media of

communication to the public. The method is used to create awareness and interest in the new ideas

or techniques among the majority of the people. Mass media include the use of radio, television,

newspapers, film shows, pamphlets, banners, handbills and hand-outs etc

TYPES OF MASS MEDIA

There are two major types or groups of mass media. These are electronic media and print media

a. ELECTRONIC MEDIA: This involves the use of electronics like radio, television, film shows etc to

transmit information to the people. Through the electronic media many people can easily be

reached if only they have the means. It is an expensive method of transmitting information to the

public

b. PRINT MEDIA: This involves the use of media like newspapers, banners, handbills, newsletters,

hand-outs, pamphlets etc to disseminate information to the people just like the electronic media,

information can get to many people but illiteracy, combined with poverty would prevent many

people from getting the desired information. Mass media (electronic and print) have the same

advantages and disadvantages

ADVANTAGES OF MASS MEDIA

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i. They can reach out to a large audience, provided it is within their means

ii. They may not require the presence of the operators

iii. The information can easily reach the audience as a fixed date and time e.g either on radio or

television

iv. Time wasting and stress involved in going round the audience are eliminated

v. The information especially the print media last long

vi. The printed information can be posted or received by mail

vii. Pictures (in electronic) can easily be served as demonstration aids

viii. It is useful in information dissemination to the deaf but literate audience

DISADVANTAGES OF MASS MEDIA

i. They are very expensive to operate e.g talks on radio or television

ii. They are only useful to the educated audience, the illiterate audience can never benefit

iii. They are only available to the audience who are wealthy enough to own television and radio sets

INTERNET: Internet is a global network of computers and communication devices. It is also a public

network that connects several computers, communication devices and smaller networks into a

global network. It can also be referred to as the convergence of computer system worldwide with

the assistance of telecommunication link which allows any computer with the telecommunication

link to exchange information with any suitably equipped computer

SATELLITE: A satellite is a communication equipment which is deployed and stationed in the space

to send signals to different countries of the world. Satellites are systems of global transmission of

signals from one place to another. With the satellite, it is now possible for live telecast of an event in

Lagos to be watched in America e.g an international football match. Satellite enhances the work of

NITEL as all nations are linked together through satellite

FUNCTIONS OF SATELLITE

i. Satellite provides telephone and television links among nations of the world

ii. It ensures international or global transmission of messages

iii. It ensures that live events are covered and watched simultaneously all over the world

iv. Video conferencing meetings are made possible by satellite television transmission

COURIER SERVICES: Courier services are duties rendered by privately owned courier companies to

provide reliable and efficient means of conveying urgent documents within and between cities and

towns. Their services include fast and reliable delivery of letters, documents and parcels. Companies

providing courier services in Nigeria are DHL, UPS, Fedex, IAS etc

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FUNCTIONS OF COURIER COMPANIES

i. Provision of efficient means of mail delivery: Courier companies provide reliable and efficient

means of sending urgent documents at greater speed

ii. Safe delivery of documents: Important documents are delivered safely without getting lost in

transit

iii. Ensure cordial relationship: Personal and cordial relationship exist between them and their

customers

iv. Transportation of load: Courier companies help to carry bulky loads over short or long distances

v. Shipment of goods: Some courier companies undertake the shipment of export and import goods

vi. Business reply services: They provide business reply services to customers

vii. Proof of delivery: Courier companies provide proof of delivery by keeping proper record of every

transaction

viii. Banking services: Banking transactions are facilitated by courier services and this has greatly

reduced time taken in interbank transactions

ix. Render services in all location: They render services to both urban and rural areas

x. Long hours of service: They provide long hours of services running up to about 24 hours per day

xi. Door to door services: Courier companies provide door-to-door delivery services to its customers

DIFFERENCES BETWEEN COURIER SERVICES AND PUBLIC POSTAL SERVICES

COURIER SERVICES PUBLIC POSTAL SERVICES

Services is faster and reliable Services is not as fast and reliable

High charges for service Lower charges

Longer hours of service Shorter hours of service

Provide insurance cover for documents Documents are not insured

Provide door-to-door services Do not provide such services

Services are rendered by private individuals Services are rendered by government enterprises

Documents are safe and secured Documents are not as safe and secured as courier

COMPUTER SERVICES

1. INTERNET SERVICES: Internet is a global network of computer which communicates, using a

common language. It is similar to the international telephone system except that no one owns or

controls the network. If someone has access to internet, he can retrieve information from millions of

sources e.g schools, governments, businesses and individuals. No single person or group can be

credited as the inventor of the internet, although it was the USA military that set the ball rolling by

the end of the 1960s with a communication network called Advanced Research Project Agency

Network

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2. WORLDWIDE WEBSITE: This is a graphical multimedia portion of the internet. It is not in itself the

internet but it gives you a graphical ease to navigate interface for looking at documents on the

internet

3. E-MAIL: This is simply a way of sending electronic message from one person to another over the

internet through the computer i.e data and text circulating through interlinked computers. The

receiver usually has a mail box for receiving electronic messages. If the receiver is currently using the

terminals, a symbol often appears on the screen indicate that a message has been received. When it

is not in use, the e-mail message is still received into the mail box and the receiver informed that a

message has been received next time the terminal is switched on

ADVANTAGES OF E-MAIL

i. It is faster than traditional mail facilities within a company

ii. Messages can be stored

DISADVANTAGES OF E-MAIL

i. The system can be overburdened by the sending of junk mail

ii. Both senders and receivers must fact the task of clearing obsolete messages from the system

periodically