Branches of Commerce

By the end of this session, you will be able to: Define Branches of commerce, Trade and Aids to Trade. Identify and the types of trade. Define import and export. Identify and explain at least four Aids to Trade. Create a PowerPoint presentation with the help of a

storyboard for the topic Branches of Commerce.

Bran

ches

of

Com

mer

ce

TradeHome trade

Foreign Trade

Aids to Trade

Banking

Transport

Communications

Advertising

Warehousing

Insurance

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Branches of Commerce

Commerce includes all the activities which contribute to the transfer of surplus goods from the original producer to the final consumer at the right time, at the right place, in the right quantity and at the right price.

Trade

Trade means the actual buying and selling of goods with a view to making a profit. It involves satisfying directly or indirectly the wants of consumers by transporting the 'right' goods, both final and intermediate, from the producers to the consumers. There are two main types of trade; Home trade and Foreign trade

Aids to Trade

Trade cannot be carried on without aids to trade. So aids to trade are the various activities carried on to help carry out trade. The aids to trade include banking, transport, communications, warehousing, advertising and insurance.

Home Trade

Home trade is carried out among the people of the country itself. It may be wholesale or retail. A wholesaler buys from the producer and sells to the retailer who in turn resells to the final consumer.

Foreign Trade

Foreign trade is trade between the people of one country and the rest of the world. It may be import trade or export trade, both of which are normally wholesale in nature.

BankingCommercial banks facilitates trade and production by providing:

Finance-loans and overdrafts Other services of current account- receipts and

payments by cheques standing order, direct debit, etc. Services of deposits account

Other services

TransportWithout transport it is impossible for raw materials and finished goods to move from other sources through the various stages until they reach the final consumer. Imports and exports are normally transported by sea and air. Same time goods in home country are conveyed by road and rail.

CommunicationsIt is very important for traders and all other commercial institutions to transmit and receive accurate information via telephone, fax, telegram, e-mail, letter, etc.

AdvertisingAdvertisements remind the final consumer about the availability of particular brand of goods and services and try to persuade the people to buy them. Advertisement provides market for the particular brand.

WarehousingWarehouse provides storage facilities for goods after purchase or after manufacturing. Warehouses ensure the continuous supply of raw materials and finished goods and prevent fluctuations in prices.

InsuranceInsurance companies facilitate the production and trade by absorbing some of the risks. Businessmen face various types of risks. The goods may be destroyed during production stage of storing. Therefore, insurance companies give protection against all kinds of insurable risk.