LeoGlossary: Commerce

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Commerce can be summed up as the exchange of goods and services between two or more parties. It is primarily the focus of the sale of finished or unfinished goods. We commonly see the goods or services exchanges for money or something of equal value.

Commerce is considered to be a subset of business and not business itself.

In this regard, commerce is trade. This is one aspect. The other can be thought as the aids to trade. This includes transport, warehousing, distribution, advertising, insurance and banking.

This makes trade a subset of commerce.

History

Commerce was a part of economies since the earliest days. Originally barter was the main form of commerce were goods and services were swapped directly for each other.

The introduction of currency, in its different forms, served to foster economic activity between parties. Trade routes were set up in ways to facilitate the exchange of goods and services by building a distribution process to bring together sellers and buyers.

Exchanging one thing of value for another has had an incredible impact on the world and was influenced by geography, climate, politics, peace, war, fashions, and language.

As communications and transportation have evolved over the centuries, a globalized world with international trade complete with global trade emerged.

In the early centuries of trade, markets functioned as a new meeting place. People came physically came together to trade goods. Merchants often set up shop in a plaza (or some other gathering place) where shoppers could acquire what was needed.

Over time, this helped to expand society as people were exposed to new products and ideas. This grew as traders were drawn from further regions.

Civilization, trade, and currency can be seen advancing over the centuries, something that is accelerating at an increasing pace.

Digital Age

The selling of a single item is a transactions. The totality of transactions is considered commerce.

E-commerce is the selling of goods and services on the Internet. This is usually done through websites. Online payment systems such as PayPal we established. Applications such as this were created to facilitate commerce online.

The accompanied advancement in telecommunications. Digital networks expanded in speed and bandwidth. This allowed for more transactions to be processed.

Corporations like Amazon have transformed commerce. The percentage of sales occurring in the digital realm are growing each year. This caused a retail apocalypse in the United States, with many locations facing bankruptcy.

Even a company like Tesla is selling all their cars online. This is having a major impact upon car dealerships.

The digital era is ushering further advancement in trade and currency. Web 3.0 is considered to be the next generation of the Internet, bringing cryptocurrency into being.

Digital wallets are promoting the idea of being able to transact without the use of financial intermediaries. This has been a standard for the traditional financial, also called TradFi, for centuries. The great bank

Types of Commerce

  1. Business-to-Customer (B2C)
  2. Business-to-Business (B2B)
  3. Business-to-Government (B2G)
  4. Consumer-to-Government (C2G)
  5. Consumer-to-Consumer (C2C)
  6. Consumer-to-Business (C2B)
  7. Direct-to-Consumer (D2C)

Branches of Commerce

  1. Trade
  2. Transport
  3. Warehouse and Storage
  4. Distribution
  5. Advertisement
  6. Insurance
  7. Communication
  8. Banking

This covers from origin to destination.

General: