Q.Describe the activities relating to commerce.

Commerce exists to link producers with consumers, and it does so by removing the various hindrances that stand in the way of a free exchange of goods and services. …

Commerce includes two types of activities

• Trade — the buying and selling of goods (sale, transfer or exchange of goods, physical or virtual), making produced goods available to consumers.
• Auxiliaries to trade — the services that make buying and selling possible: transport, banking, insurance, communication, advertisement, packaging and warehousing.

Commerce provides the essential link between producers and consumers and includes all activities needed to keep a free flow of goods and services.

Commerce removes the hindrances in exchange

• Hindrance of persons — removed by trade, passing goods from producers to consumers.
• Hindrance of place — removed by transport, moving goods from production points to markets.
• Hindrance of time — removed by storage and warehousing, holding stock so goods are sold as and when required.
• Hindrance of risk — goods in stock or transit may be lost/damaged; insurance protects against this.
• Hindrance of finance — the capital needed is provided by banking and financing institutions.
• Hindrance of information — advertising informs consumers about the goods and services available.

The main auxiliaries in brief

• Transport & communication — provide movement and information exchange. …