Introduction

“Trade is the life of humanity (…)” rightly asserts Jean Baptise Say to signify the fact that no man can deprive himself of trading, man being by nature a being of need. In its practice, trade, which is assimilated to an economic activity that consists of buying, selling, exchanging or distributing goods and services to satisfy the needs of consumers, can be segmented into two categories: a formal category and an informal category. The first is characterized by its informational clarity while the second is at the same time, of a dangerous informational asymmetry for certain elements of the chain such as the customer and of a strategic utility for the merchant in his game of deception.

Trade in the Market Economy

It is immediately important to know that in a market economy, production, distribution and price decisions are determined only by supply and demand on the market, without direct intervention of the State. The direct consequence of this state of affairs is that the merchant, the person or company that buys goods or services to resell them to customers, can legally and with impunity exaggerate his profit margin and financially abuse the customer who is the weakest link in the chain.

The Intervening Factors

Three essential actors intervene in a market economy: the supplier who is the one from whom the merchant buys his products, generally at preferential prices and the customer who buys goods or services from a supplier or merchant. Bargaining is therefore a commercial practice where an intermediary buys goods or services from a supplier and resells them at a higher price to a customer. In this architecture, the merchant occupies a privileged position since very often, he plays the intermediary between the supplier and the customer, hence the practice by him for the most part of a murky game to his exclusive advantage.

The Vice of Regulation and the Trap of Number or Quantity to the Detriment of the Supplier 

The supplier, who may also be the producer, is subject to the obligation to approve the prices of products from his manufacturing plant. He is constantly subjected to price control, which reduces his room for manoeuvre compared to merchants who, well informed about prices, do not skimp on the means to play the card of the large quantity requested and, by this very fact, obtain “a wholesale price” which means the reduction of the unit price of the products purchased. The merchant therefore almost always comes out “winner” in the commercial relationship which binds him to the supplier.

Information Asymmetry to the Disadvantage of the Customer

A vulnerable stratum of construction, the customer is for the most part a “great illiterate” in terms of prices. The merchant therefore happily takes advantage of this to impose exorbitant costs on him which are insolently above the purchase prices. Thus, depending on the customer’s education and his mastery of the prices of products on the market, the same product can be sold by the same merchant at exponentially different prices, sometimes ranging from double to quintuple.

Conclusion

Mass education is therefore necessary in terms of pricing practices on the market and even strong regulation in the direction of price approval, labelling of goods to remove ambiguities about the real costs of goods.

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