The persons involved in putting-out system are weavers and merchants.
This system is advantageous for the weavers in two ways:
(a) They do not have to spend their money on the purchase of yam.
(b) They are also free from the tension of selling the finished cloth.
This system is disadvantageous for the weavers in these ways:
(a) They have to depend on the merchants for raw materials as well as markets.
(b) Under this system the merchants become very powerful. They give orders for what is to be made and they pay a very low price for making the cloth.
(c) The weavers have no way of knowing who they are making the cloth for or at what price it will be sold.
