Mail order business types are different categories of retailers who sell goods through postal services without physical stores. The three main types are manufacturers, department stores, and specialists who send catalogs and deliver products by post.
Quick Summary
- Manufacturers mail order – Companies make and sell their own products directly to customers
- Department store mail order – Large retailers offer wide product range through catalogs
- Specialist mail order – Focus on specific products like books, clothes, or electronics
- All types use catalogs, websites, or magazines to display products
- Popular in Nigeria through Jumia, Konga, and other e-commerce platforms
Understanding Mail Order Business in Nigeria
Mail order business has changed over the years in Nigeria. Before, companies sent printed catalogs to homes. Today, most mail order happens online through websites and mobile apps. But the basic idea stays the same – customers order products without visiting a physical store.
In Nigeria, this business model grew fast with companies like Jumia (started 2012) and Konga (started 2012). These platforms let customers browse thousands of products from their phones. They made mail order easier by adding cash-on-delivery payment options.
The Three Main Types of Mail Order Business
1. Manufacturers Mail Order Business
This type involves companies that make their own products and sell directly to customers. They cut out middlemen and save money.
How it works:
- The manufacturer makes the product in their factory
- They create catalogs or websites showing their items
- Customers order directly from the manufacturer
- Products ship from factory to customer’s home
Nigerian examples:
- Indomie selling noodles directly through online platforms
- Nigerian Breweries offering beverages through their websites
- Dangote products sold online without retail stores
Advantages for manufacturers:
- Higher profit margins – no retailer takes a cut
- Direct customer feedback helps improve products
- Control over pricing and brand image
- Know exactly who buys their products
Disadvantages:
- Must handle customer service and complaints
- Need warehouse space for inventory
- Shipping costs can be high
- Compete with their own retail partners
2. Department Store Mail Order Business
Large retailers that sell many different product categories through mail order. They buy from various manufacturers and resell to customers.
Characteristics:
- Offer thousands of different products
- Sell clothes, electronics, home goods, toys, and more
- Create thick catalogs or large websites
- Have big warehouses to store inventory
Nigerian examples:
- Jumia – sells over 10 million products across all categories
- Konga – merged with Yudala to create Nigeria’s biggest e-commerce store
- Slot – originally a phone store, now sells many electronics online
Why customers like department store mail order:
- Buy everything in one place – saves time
- Can compare prices across brands
- Usually offer promotions and discounts
- Have customer service teams to handle problems
- Trusted brands with good delivery records
Challenges they face:
- Need huge investment in warehouses and logistics
- Must stock thousands of products – ties up money
- Returns and exchanges cost money
- Competition from specialist stores
- Bad roads in Nigeria make delivery expensive
3. Specialist Mail Order Business
These businesses focus on one type of product or serve one specific group of customers. They become experts in their area.
Examples by product type:
- Books and educational materials: RON (Rovingheights Online Bookstore), CSS Bookshops online
- Fashion and clothing: Payporte (Nigerian fashion), Zando
- Electronics: Pointek, Slot online store
- Baby products: Mamas Pride, Babystore Nigeria
- Health and beauty: Kara.com.ng, Beautyclick
- Food and groceries: ShopRite online, Market Square
Benefits of specialist approach:
- Deep knowledge of products – can advise customers better
- Attract loyal customers who trust their expertise
- Smaller inventory – easier to manage
- Build strong supplier relationships
- Stand out from department stores
Disadvantages:
- Limited customer base – only people who need that product
- Harder to grow if market is small
- Seasonal sales variations (e.g., school books sell more in September)
- Must compete with department stores that also sell their category
Comparison of the Three Types
| Feature | Manufacturer Mail Order | Department Store | Specialist |
|---|---|---|---|
| Product Range | Own products only | Very wide – all categories | Narrow – one category |
| Profit Margin | Highest – no middlemen | Medium – volume sales | High – expert pricing |
| Initial Investment | Very high – factory needed | Very high – big warehouse | Lower – small inventory |
| Customer Base | Brand loyal customers | Very wide – everyone | Targeted niche |
| Competition Level | Medium – brand power helps | High – many big players | Low to medium |
| Delivery Complexity | Simple – one location | Complex – many products | Medium – focused items |
| Nigerian Example | Dangote products online | Jumia, Konga | Payporte (fashion only) |
How Mail Order Business Works in Nigeria Today
The Nigerian market has unique features that affect all three types of mail order business:
Payment methods: Cash-on-delivery remains popular. Many Nigerians don’t trust online payments yet. Jumia reports that 80% of their orders use cash payment at delivery.
Delivery challenges: Bad roads in many states make shipping slow and expensive. A package from Lagos to Maiduguri might take 7-10 days instead of 2-3 days.
Customer behavior: Nigerians like to see products before buying. Mail order companies fight this by offering free returns and detailed product photos.
Mobile shopping: Over 90% of online orders in Nigeria come from mobile phones. All three business types must have good mobile apps.
Common WAEC Exam Mistakes
Students often make these errors:
- Confusing types with features: The question asks for “types” but students write features like “uses catalogs” or “delivers by post.” Types are manufacturer, department store, and specialist – not characteristics.
- Listing only two types: Many students forget specialist mail order and only mention manufacturer and department store. Always give all three types unless the question asks for a specific number.
- Giving examples instead of explaining: Writing “Jumia” is not enough. You must explain it’s a “department store mail order business that sells multiple product categories online.”
- Mixing up advantages with types: When asked to “state types,” don’t explain advantages. Save that for questions that ask “explain the features” or “advantages.”
- Writing “online business” as a type: Online shopping is a method, not a type. The types remain manufacturer, department store, and specialist whether they use internet or printed catalogs.
Practice Questions
Multiple Choice Questions
1. Which type of mail order business sells products directly from the factory to customers?
a) Department store mail order
b) Manufacturer mail order ✓
c) Specialist mail order
d) Retail mail order
2. Jumia Nigeria is an example of which type of mail order business?
a) Manufacturer mail order
b) Specialist mail order
c) Department store mail order ✓
d) Producer mail order
3. A mail order business that focuses only on selling books and educational materials is called:
a) Department store mail order
b) Educational mail order
c) Specialist mail order ✓
d) Manufacturer mail order
4. The main advantage of manufacturer mail order business is:
a) Wide product range
b) Lower prices for customers
c) Higher profit margins ✓
d) Better delivery service
Essay Questions
Question 1 (10 marks):
Explain the three types of mail order business, giving one Nigerian example for each type.
Examiner’s tip: Use clear paragraphs for each type. Start with definition, then example, then one key feature. Write 3-4 sentences per type.
Sample answer structure:
- Manufacturer mail order – definition (2 marks), example (1 mark), feature (1 mark)
- Department store mail order – definition (2 marks), example (1 mark), feature (1 mark)
- Specialist mail order – definition (2 marks), example (1 mark), feature (1 mark)
Question 2 (8 marks):
State four differences between department store mail order and specialist mail order business.
Examiner’s tip: Use a table or clear comparison format. Each difference is worth 2 marks – 1 mark for department store point, 1 mark for specialist point.
Question 3 (6 marks):
Describe three challenges facing manufacturer mail order businesses in Nigeria.
Examiner’s tip: Don’t just list – describe means explain each challenge. Write 2-3 sentences per challenge. Common mistakes: Students write general business problems instead of specific mail order challenges.
Memory Aids
Remember the three types with “MDS”:
- M = Manufacturer (Makes their own products – like Dangote selling direct)
- D = Department store (Different products – like Jumia selling everything)
- S = Specialist (Single category – like Payporte selling only fashion)
Think of it this way:
- Manufacturer = “I made it, I sell it”
- Department store = “We sell everything”
- Specialist = “We know this one thing best”
Related Topics
To understand mail order business better, also study these related topics:
- Features of Mail Order Business – Learn key characteristics of all mail order operations
- Advantages of Mail Order Business – Why this business model works well
- Disadvantages of Mail Order Business – Challenges and limitations
- Channels of Distribution – How products move from producers to consumers
- Factors in Choosing Distribution Channels – How businesses decide on distribution methods
Key Takeaway: All three types of mail order business exist in Nigeria today. Manufacturers like Dangote sell direct online. Department stores like Jumia and Konga sell many product categories. Specialists like Payporte focus on one area. Understanding these types helps you answer WAEC questions correctly and understand how modern e-commerce works.