Commerce is the strong foundation of any society or nation. The economy of any society depends on the transaction of goods and services for some monetary exchange. The process of need, demand, and supply can also be termed as a part of commerce. The characteristics of commerce in themselves speak loud, the prime importance of commerce in any society. Commerce is a process which includes all the steps from collecting raw material to converting it into finished goods and services to its distribution reaching the buyers. The characteristics of commerce make it mandatory to include a monetary transaction in all its processes as it is purely an economic activity which works for the sake of profit.
FUNCTIONS OF COMMERCE
Commerce acts as a link between the raw material, goods and services, and the market and has important multiple functions to perform in any business.
- Commerce as a process needs many people to work together to meet the requirements and thus is the creator of job opportunities for a large number of people.
- Commerce creates a common platform of business for sellers and buyers without any actual physical contact.
- One of the important characteristics of commerce is the transportation of raw material to the production house and the transportation of finished goods and services to the consumers.
- Commerce makes the services and goods available to people across boundaries.
- Commerce involves monetary exchange for all its processes and thus raises the standard of living of people involved.
- Commerce is a vast process which facilitates mass production of goods and services, making it available for people to enjoy its fruits within and outside the country.
- Being a monetary process which involves the exchange of money at each step, commerce helps a nation to grow and develop.
Commerce takes the responsibility of protecting the lack of any goods and services in an economy and at the same time creates the market for all its goods and services. It maintains a balance between demand and supply of each and every goods and service. Let us count the chief characteristics of commerce as a base of any economy.
1. PURELY ECONOMIC AND BUSINESS ACTIVITY:
The needs and wants of the masses give rise to the production of goods and the creation of services in an economy. The buying and selling of these goods and services with an aim to earn a profit are what the characteristic of commerce is and hence it is purely an economic and business activity. It creates employment and helps in the process of growth of the industries and the economy as well.
2. PRODUCTION AND MARKETING:
One of the chief characteristics of commerce is to provide a connecting cord from the one end of the needs to raw material to production to finished goods and services to marketing to selling and buyers at the other end. Commerce puts all the beads together in a thread. It ensures the production of all the required products and services and then at the same time maintains the availability of market and buyers for each and every product and service.
Business cannot fulfill all the needs and requirement in one single transaction. The goods and services are required to be delivered continuously for the needs of the people as well as for the growth of the business. So, we can say that continuity is a special characteristic of commerce that cannot be missed. Production, transportation, and delivery of the goods and services should be continuous so as to maintain a balance between demand and supply.
Not only this any activity must invest its resources in research and development to grow further and move a step ahead. Research and progressive approach is again a continuous process.
4. AIMS AT PROFIT:
Any economic and business process aims at a profit and so is the characteristic of commerce as well. From the purchase of raw material to the production, distribution, marketing, transportation and finally selling the finished goods and services all the activities aim to earn a profit. It enhances the growth of an economy and raises the standard of living of people. The amount of profit motivates the people to serve better and grow together in an economy as a whole.
5. CHALLENGING AND UNCERTAIN:
Every business and for that matter, every rewarding task accompanies challenges and uncertain conditions. In business also we face many challenges and such uncertain conditions which we have to overcome and make ourselves prepared for. Challenges and uncertainties are the characteristic features of commerce. There are two kinds of uncertain situations i.e., predictable for which we can arrange precautionary measures and some unpredictable situations which we have to welcome and overcome. These situations help in exploring possibilities and new dimensions of our business.
6. CREATIVE AND EVER EVOLVING:
Business is an art and every art is creative in its sphere. As a domain of business creativity and evolutions are the characteristics of commerce. It is the job of a businessman to seek new, innovative and creative methods of production, distribution, sales, and marketing of its products. Development in the current goods and services, as well as innovative ideas for new products and services together, forms this creative process of commerce. This creativity is ever evolving and does not pause or terminate at any step.
7. CUSTOMER CENTERED:
From the older profit-oriented approach commerce has shifted to the modern customer-oriented approach. Profit making is still a part of commerce but modern business is customer centered and aims at the complete satisfaction of the customers. It provides the best products and services at a reasonable cost to its customers.
Business and society both are connected and forms a team, without the existence of one, the other cannot exist. Business needs people from society to work as employees, investors to invest money, and customers to buy the products, whereas a society also needs the goods and services produced in a business. We can conclude that socialization is one of the chief characteristics of commerce.
9. ROLE OF GOVERNMENT:
Business is run for the welfare of society and to ensure the same business has to follow certain guidelines and rules and regulations formed by the government. Governance control is also the characteristic of commerce.
10.OPTIMUM UTILISATION AND SERVING OF RESOURCES:
The progress of any business highly depends on the optimum utilization of all the available resources and making maximum output with the minimum input. Saving of resources also ensures growth and best utilization of resources.
All the characteristics of commerce together compile and outshine what commerce is in its real sense. Commerce is an important beam of any economy or business. It is the strong foundation of national development and creation of wealth for the nation and its people.