Types of specialization

len Alfred Ajibola - 03rd January, 2024 @ 04:32 PM

Topics in Commerce

Types of specialization Specialization and Exchange Historical background of commerce in Nigeria Disadvantages of barter system Contract of Employment: Terms of employment contract Principle of Marketing: People as a marketing mix and their importance Principle of Marketing: Positioning as a marketing mix Principle of Marketing: Packaging as a marketing mix Elements of promotion in marketing mix Principle of Marketing: Promotion as a marketing mix Principle of Marketing: Place as a marketing mix Principle of Marketing: Price as a marketing mix Principles of Marketing: The seven principles of marketing mix Factors necessary for division of labour Disadvantages of division of labour Advantages of division of labour Concept of Outbound Marketing Inbound Marketing explained Types of production in commerce Commerce: Definitions and Scopes of Commerce

Academic Questions in Commerce

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In commerce, the concept of paying in advanced is termed _____.

  • A. Advanced payment

  • B. Up payment

  • C. Forward payment

  • D. Prepayment

  • E. Uphill payment

  • F. Adpayment

In commerce, the concept of 'buy now, pay later' is termed _____.

  • A. Unadventurous payment

  • B. Buy on credit payment

  • C. Deferred payment

  • D. Postponed payment

  • E. Owed payment

  • F. Future payment

In commerce, which of the following is false with regards to a commodity?

  • A. A commodity must always have a market value

  • B. Rendered services are also instances of commodities

  • C. Products applicable to commodities can be bought or sold with money

  • D. A commodity must be standardized

  • E. A commodity must be usable upon delivery

  • F. Commodities can be traded in the futures market

Whatever is being marketed must always provide value to its potential consumers.

  • A. True

  • B. False

Which of the following is not a branch of marketing?

  • A. Merchandising

  • B. Promotions

  • C. Forex

  • D. Search Media Optimization

  • E. Social Media Optimization

  • F. Copywriting

Which of the following is not a characteristics of commerce?

  • A. The only aim of commerce is to make profit

  • B. It is a discontinuous process after profit had been made

  • C. It is accompanied with challenges and uncertainties

  • D. It is 100% business and economic activity

  • E. Transaction processes are always involved in commerce

  • F. It connects the process of production and marketing

Which of the following is not a function of commerce?

  • A. Unnecessary in times of emergencies like earthquakes and wars

  • B. Facilitates mass production of goods

  • C. Influences transportation network within and outside a state

  • D. Attempts to satisfy human needs and wants

  • E. Improves the standard of living

  • F. Acts as an online business link between buyers and sellers

One of the following is a form of division of labour.

  • A. Agonistic division of labour
  • B. Antagonistic division of labour
  • C. Mutualistic division of Labour
  • D. Advanced division of labour
  • E. Solitary division of labour
  • F. Occupational division of labour

Types of Specialization

Recall that specialization in business involves the concentration of an individual or a workforce towards the production of limited goods, or rendering of limited services in order to gain advantage and efficiency over other similar businesses.

Please read more on the introduction to specialization here.


Generally, specialization may be categorized into various types (or forms). They include the following:


  • 1. Labor Specialization

This form of specialization is often termed as division of labor. It is quite common in production factories, government agencies and academic institutions. With reference to production factories, specialization ensures that the workers involved in the manufacture of a product are assigned specific tasks in which they've been properly trained, and are consequently skilled in. This concept of specialization brings about increased quality of production.

Division of labor is pivotal towards achieving specialization. You can think of division of labor as an act of splitting a job process into a number of different processes, such that each process is done by a person or group of persons. Therefore, each person (or persons) in division of labor perform only a part of the job, and are often specialized in their roles or functions.

Please read more on division of labor here.


An example of division of labor is seen in academic institutions; for instance, secondary schools. Here, trained and qualified teachers are assigned to teach only the subject they are specialized in. In this regard, one teacher may teach commerce, while another teaches mathematics, according to their respective speciality.

On the part of students, they begin by learning all subjects. However, a stage is reached where they begin to gradually specialize in their fields. For instance, senior secondary school students will have to choose the science, commercial or art department, and will consequently stop offering some subjects.

At the university level, students will further specialize in their dream courses. For instance, out of the numerous sciences course at the university level, a student may choose to study medicine, thus specializing here.

Please read on the forms of division of labor here.


  • 2. Website and Social Media Specialization

The contents of the world wide web (www) comes from all websites on the internet. Most of these websites are designed (or specialized) to create specific contents. Take for instance, Len Academy is a website whose contents are focused on educational and academic write-ups. On a broader view, we have many other websites dedicated (or specialized) to other nitches like sports, music, movies, local news, photography, travels and tourism, food and so on.

You can read on the internet and world wide web here.


Social media applications like youtube has shown great specialization in its design and functionality. In this regard, we have content creators who exhibit their specialization and talent through videos. Apparently, people are allowed to follow whichever channel they love. Some of these channels include comedies, music, football, video games, entertainment, movies, food, tourism, real estate, health and so on.

Other social media applications that show specialization in some of their contents include facebook, instagram, twitter, whatsApp, telegram, tiktok and so on. In these aforementioned app, its users may create pages that are specific to whatever content they wish to put out, while those with keen interest may like and follow their respective pages.

You can attempt questions and answers on various academic subjects here.


  • 3. Businesses Specialization

This form of specialization limits a business towards producing a limited range of goods and services. For instance, one or more individuals may focus only on running a cocoa plantation business. In this regard, all efforts are geared towards the growing and harvesting of cocoa on a large scale.

Similarly, individuals may also render specialized services in accordance with their skill sets, utilizing this specialization towards their business growth. Such services may include dry cleaning, phone repairs, fashion designing, hair dressing, website development, forex trading, marketing executives, food businesses and so on.

Please read on sole proprietorship here.


Businesses are often classified into various structures. Ideally, these business structures are often specialized in order to achieve efficiency, comparative advantage and absolute advantage respectively. Below are examples of various business structures:


Regardless the small size of a business (sole proprietorship for instance), an individual who diligently undergoes business specialization may likely become successful in the long run.


  • 4. Departmental Specialization

This form of specialization is praticed in organizations, institutions, religious houses and so on.

Using a tertiary institution (university) as our point of reference, it typically comprises of various departments, with each coordinated by the head of department (HoD). For instance, the biochemistry department is considered a department in the university. This department is expected to have its respective professors and lecturers, whom are specialized (or vast) in the knowledge of biochemistry; and are consequently shouldered with the responsibility to pass knowledge to students on this field of study.


A university can also have a non teaching department. The bursary department is an instance here. Functionally, they render financial services by managing and maintaining financial records of a university.

You can attempt Len Academic questions in commerce here

Departmental specialization may be defined  as division of a large organization such as a government, university, or business, with each division dealing with (or specializing in) a specific area of activity.


  • 5. State and Regional Specialization:

A country may be divided into states or regions, with these specializing in one or more areas of production.

Using Nigeria as a point of reference, Benue state is situated in the nation's north central region, and is quite popular for its farming activities, especially the cultivation of root and tuber crops like yams, cassava, cocoyam and so on.

Also, large quantities of fruits and vegetables are grown here, and are exported to other parts of the country. In fact, the slogan of Benue state, Nigeria is: 'food basket of the nation'.

You can read the concept of plants and crops alongside their differences here.


The Silicone Valley region of nothern California is quite popular for its high technologically oriented companies. In this regard, the headquaters of big tech companies such as alphabet Inc. (parent company of Google and its subsidiaries), apple, facebook, cisco, Intel, oracle, and hawlett packard are present here. 


The point to note concerning state and regional specialization is the fact that a state/region may become popular for one or more commercial activities, thus becoming a major center for the production of certain goods, or rendering of specific services.

Please read on the types of production in commerce here.


  • 6. Country Specialization

Countries can become specialized in the goods they produce, alongside their rendered services. Therefore this form of specialization ensures that a country can earn foreign exchange, and this is crucial towards boosting national revenue.

With regards to country specialization, Nigeria is popular for its exportation of petroleum (crude oil). However, it doesn't even rank among the top 10 global producers of oil.

Please read interesting facts for students here.


The table below shows the specialization of various countries.

Specialization Countries
Wine production Italy, France, Spain, USA and Argentina
Watch manufacturing Switzerland and Japan
Car manufacturing China, Japan, USA and Germany
Military weapons USA, Russia, France, Germany and China
Video game industry USA, Japan, South Korea and China
Rice production China, India, Bangladesh and Indonesia
Rubber production Thailand, Indonesia, Vietnam and India
Natural gas production USA, Russia and Iran
Crude oil (Petroleum) USA, Saudi Arabia, Russia, Canada and China

You can read keypoints for students in commerce here.

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Amazing facts in Commerce

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Notable points in Commerce

The theory of international trade is guided by the principle of comparative cost. This principle was propounded by David Richards.

The principle of comparative cost states that a country should specialize in the production of goods and services in which they have a greater comparative advantage or the least comparative disadvantage.

Below is an instance on the principle of comparative cost.

Now, let us assume we have two countries producing and exporting rice and beans respectively.

  • On a daily basis, If country A produces 100 grams of rice and 300 grams of beans daily and country B produces 50 grams of rice and 150 grams of beans, then according to this principle, country A has an advantage over country B with regards rice and beans production; but better still, country A has a greater comparative advantage in the production of beans.


From the above instance, it can also be said that country B is at a disadvantage with regards to the production of rice and beans. Infact, it has a bigger comparative disadvantage with regards to beans production.

The point to note here is this: A country utilizing the principle of comparative cost will always produce quality goods and services at a cheaper cost.

No single country manufactures all the goods and services in our world. This implies that every country of the world relies on certain goods and services imported (or brought in) from other countries.

Foreign trade is defined as the exchange of goods, services and capital between two or more countries.

Foreign trade is also termed as international trade.

Please read more on foreign trade here

Division of labour can be defined as the act of splitting job process into a number of different processes such that each process is done by a different person or group of persons.

Through the process of division of labour, one worker may constantly perform a specific aspect of the job and as a result, may become specialized in that area.

The result of specialization in the different department of a job will imply the production of goods with better quality.

Please read on division of labour here

Forms of division of labour relates the various ways through which division of labour may be carried out.

Take for instance, within a country, one state may choose to specialize in the production of a cars while another specializes in a different area, let's say agriculture.

Below are the forms of division of labour

  • Complex division of labour

  • Occupational division of labour

  • Geographical division of labour


Please read more on the forms of division of labour here.

Balance of Trade can be defined as the total value of goods imported and exported by a country during a specific period; usually yearly or annually.

Balance of trade can be either positive, negative or zero

  • A positive balance of trade implies that a country exports more goods than its imports. China as a country is likely to have a positive balance of trade since it exports a variety of goods to other countries.

  • A negative balance of trade is often considered as an unfavorable balance of trade since the country's importation exceeds its exportation. Nigeria (as at 2018) is likely to have a negative balance of trade.

  • A zero balance of trade is reached when imports equal exports.

Please read on balance of trade and balance of payments here.