Commerce is the large-scale organized system of activities, functions, procedures and institutions directly and indirectly related to the exchange (buying and selling) of
goods and services
Goods are items that are usually (but not always) tangible, such as pens, physical books, salt, apples, and hats. Services are activities provided by other people, who include architects, suppliers, contractors, technologists, teachers, doc ...
among two or more parties within local, regional, national or international economies. More specifically, commerce is not
business, but rather the part of business which facilitates the movement and distribution of finished or unfinished but valuable goods and services from the producers to the end consumers on a large scale, as opposed to the
sourcing of
raw materials and
manufacturing
Manufacturing is the creation or production of goods with the help of equipment, labor, machines, tools, and chemical or biological processing or formulation. It is the essence of secondary sector of the economy. The term may refer to ...
of those goods. Commerce is subtly different from
trade
Trade involves the transfer of goods and services from one person or entity to another, often in exchange for money. Economists refer to a system or network that allows trade as a market.
An early form of trade, barter, saw the direct excha ...
as well, which is the final transaction, exchange or transfer of finished goods and services between a seller and an end consumer. Commerce not only includes trade as defined above, but also a series of transactions that happen between the producer and the seller with the help of the auxiliary services and means which facilitate such trade. These auxiliary services include
transportation
Transport (in British English), or transportation (in American English), is the intentional movement of humans, animals, and goods from one location to another. Modes of transport include air, land (rail and road), water, cable, pipeline, ...
,
communication
Communication (from la, communicare, meaning "to share" or "to be in relation with") is usually defined as the transmission of information. The term may also refer to the message communicated through such transmissions or the field of inqui ...
,
warehousing
A warehouse is a building for storing goods. Warehouses are used by manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc. They are usually large plain buildings in industrial parks on the outskirts of cities, tow ...
,
insurance
Insurance is a means of protection from financial loss in which, in exchange for a fee, a party agrees to compensate another party in the event of a certain loss, damage, or injury. It is a form of risk management, primarily used to hedge ...
,
banking
A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Becau ...
,
financial market
A financial market is a market in which people trade financial securities and derivatives at low transaction costs. Some of the securities include stocks and bonds, raw materials and precious metals, which are known in the financial market ...
s,
advertising
Advertising is the practice and techniques employed to bring attention to a product or service. Advertising aims to put a product or service in the spotlight in hopes of drawing it attention from consumers. It is typically used to promote a ...
,
packaging, the services of commercial agents and agencies, etc. In other words, commerce encompasses a wide array of political, economical, technological, logistical, legal, regulatory, social and cultural aspects of trade on a large scale. From a marketing perspective, commerce creates time and place utility by making goods and services available to the customers at the right place and at the right time by changing their location or placement. Described in this manner, trade is a part of commerce and commerce is a part of business.
Commerce was a costly endeavor in the antiquities because of the risky nature of transportation, which restricted it to local markets. Commerce then expanded along with the improvement of transportation systems over time. In the middle ages, long-distance and large-scale commerce was still limited within continents. With the advent of the
age of exploration
The Age of Discovery (or the Age of Exploration), also known as the early modern period, was a period largely overlapping with the Age of Sail, approximately from the 15th century to the 17th century in European history, during which seafari ...
and oceangoing ships, commerce took an international, trans-continental stature. Currently the reliability of international trans-oceanic shipping and mailing systems and the facility of the Internet has made commerce possible between cities, regions and countries situated anywhere in the world. In the 21st century, Internet-based
electronic commerce (where financial information is transferred over Internet), and its subcategories such as wireless
mobile commerce
The term mobile commerce was originally coined in 1997 by Kevin Duffey at the launch of the Global Mobile Commerce Forum, to mean "the delivery of electronic commerce capabilities directly into the consumer’s hand, anywhere, via wireless tech ...
and
social network
A social network is a social structure made up of a set of social actors (such as individuals or organizations), sets of dyadic ties, and other social interactions between actors. The social network perspective provides a set of methods for ...
-based
social commerce
Social commerce is a subset of electronic commerce that involves social media and online media that supports social interaction, and user contributions to assist online buying and selling of products and services.
More succinctly, social commerce ...
have been and continue to get adopted widely.
Legislative bodies and ministries or ministerial departments of commerce regulate, promote and manage domestic and foreign commercial activities within a country. International commerce can be regulated by bilateral treaties between countries. However, after the second world war and the rise of free trade among nations, multilateral arrangements such as the
GATT
The General Agreement on Tariffs and Trade (GATT) is a legal agreement between many countries, whose overall purpose was to promote international trade by reducing or eliminating trade barriers such as tariffs or quotas. According to its prea ...
and later the
World Trade Organization
The World Trade Organization (WTO) is an intergovernmental organization that regulates and facilitates international trade. With effective cooperation
in the United Nations System, governments use the organization to establish, revise, and ...
became the principal systems regulating global commerce. The
International Chamber of Commerce
The International Chamber of Commerce (ICC; French: ''Chambre de commerce internationale'') is the largest, most representative business organization in the world. Its over 45 million members in over 100 countries have interests spanning every sec ...
(ICC) is another important organization which sets rules and resolves disputes in international commerce.
Etymology
The English-language word ''commerce'' has been derived from the
Latin
Latin (, or , ) is a classical language belonging to the Italic branch of the Indo-European languages. Latin was originally a dialect spoken in the lower Tiber area (then known as Latium) around present-day Rome, but through the power of the ...
word ''commercium'', from ''com'' ("together") and ''merx'' ("merchandise").
History
![Caduceus](https://upload.wikimedia.org/wikipedia/commons/5/57/Caduceus.svg)
Historian
Peter Watson and Ramesh Manickam date the
history of long-distance commerce from
circa 150,000 years ago.
In historic times, the introduction of
currency
A currency, "in circulation", from la, currens, -entis, literally meaning "running" or "traversing" is a standardization of money in any form, in use or circulation as a medium of exchange, for example banknotes and coins.
A more general ...
as a standardized
money
Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money are as ...
facilitated the exchange of goods and services.
Banking system
A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Becaus ...
s developed in medieval Europe, facilitating financial transactions across national boundaries.
Market
Market is a term used to describe concepts such as:
*Market (economics), system in which parties engage in transactions according to supply and demand
*Market economy
*Marketplace, a physical marketplace or public market
Geography
*Märket, an ...
s became a feature of town life, and were regulated by town authorities.
[
]
See also
*
Bachelor of Business Administration
Bachelor of Business Administration (BBA) is a bachelor's degree in business administration awarded by colleges and universities after completion of undergraduate study in the fundamentals of business administration and usually including advanced ...
*
Bachelor of Commerce
A Bachelor of Commerce (abbreviated BComm or BCom; also, ''baccalaureates commercii'') is an undergraduate degree in business, usually awarded in Canada, Australia, India, Sri Lanka, Pakistan, Ireland, New Zealand, Ghana, South Africa, Myanmar, ...
*
Master of Commerce
Master of Commerce (MCom or M Comm; sometimes '' Magister Commercii'' as MagComm or Mag. comm.) is a postgraduate master's degree focusing on commerce-, accounting-, management- and economics-related subjects. Like the undergraduate Bachelor of Co ...
*
Doctor of Commerce
The Doctor of Commerce (DCom) is a doctoral degree in commerce-, accounting-, mathematics-, economics-, and management-related subjects, awarded by universities in the Commonwealth. The degree is offered both as a higher doctorate, and as a resea ...
*
Business
*
Capitalism
Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, price system, priva ...
*
Commercial law
*
Advertising
Advertising is the practice and techniques employed to bring attention to a product or service. Advertising aims to put a product or service in the spotlight in hopes of drawing it attention from consumers. It is typically used to promote a ...
*
Distribution (business)
Distribution (or place) is one of the four elements of the marketing mix. Distribution is the process of making a product or service available for the consumer or business user who needs it. This can be done directly by the producer or service p ...
**
Wholesale
Wholesaling or distributing is the sale of goods or merchandise to retailers; to industrial, commercial, institutional or other professional business users; or to other wholesalers (wholesale businesses) and related subordinated services. In ...
**
Retailing
*
Cargo
Cargo consists of bulk goods conveyed by water, air, or land. In economics, freight is cargo that is transported at a freight rate for commercial gain. ''Cargo'' was originally a shipload but now covers all types of freight, including trans ...
*
Eco commerce
*
Economy
An economy is an area of the production, distribution and trade, as well as consumption of goods and services. In general, it is defined as a social domain that emphasize the practices, discourses, and material expressions associated with the ...
*
Electronic commerce
*
Export
An export in international trade is a good produced in one country that is sold into another country or a service provided in one country for a national or resident of another country. The seller of such goods or the service provider is an ...
*
Fair
*
Financial planning (business)
Financial planning is the task of determining how a business will afford to achieve its strategic goals and objectives. Usually, a company creates a Financial Plan immediately after the vision
Vision, Visions, or The Vision may refer to:
Perc ...
*
Fishery
*
Harvest
*
Import
*
Laissez-faire
''Laissez-faire'' ( ; from french: laissez faire , ) is an economic system in which transactions between private groups of people are free from any form of economic interventionism (such as subsidies) deriving from special interest groups ...
*
Manufacturing
Manufacturing is the creation or production of goods with the help of equipment, labor, machines, tools, and chemical or biological processing or formulation. It is the essence of secondary sector of the economy. The term may refer to ...
*
Market (economics)
*
Marketing
Marketing is the process of exploring, creating, and delivering value to meet the needs of a target market in terms of goods and services; potentially including selection of a target audience; selection of certain attributes or themes to emph ...
*
Marketplace
A marketplace or market place is a location where people regularly gather for the purchase and sale of provisions, livestock, and other goods. In different parts of the world, a marketplace may be described as a '' souk'' (from the Arabic), ' ...
*
Mass production
*
Master of Commerce
Master of Commerce (MCom or M Comm; sometimes '' Magister Commercii'' as MagComm or Mag. comm.) is a postgraduate master's degree focusing on commerce-, accounting-, management- and economics-related subjects. Like the undergraduate Bachelor of Co ...
*
Merchandising
*
Roman commerce
Roman commerce was a major sector of the Roman economy during the later generations of the Republic and throughout most of the imperial period. Fashions and trends in historiography and in popular culture have tended to neglect the economic basis ...
*
Trade
Trade involves the transfer of goods and services from one person or entity to another, often in exchange for money. Economists refer to a system or network that allows trade as a market.
An early form of trade, barter, saw the direct excha ...
*
International trade
International trade is the exchange of capital, goods, and services across international borders or territories because there is a need or want of goods or services. (see: World economy)
In most countries, such trade represents a significant ...
*
Value (economics)
In economics, economic value is a measure of the benefit provided by a good or service to an economic agent. It is generally measured through units of currency, and the interpretation is therefore "what is the maximum amount of money a speci ...
References
{{Authority control
Trade