Characteristics of industry, trade and commerce
Industry
The term industry is used for activities in which mechanical appliances and technical skills are involved. The purpose of industry is to mould the factors of production into consumption goods.
It includes all those business activities that are concerned with the production of goods and services by converting raw material into useful products.
Industry can be defined as a manufacturing or technically productive enterprise in a particular field, country or region. For example, cotton textile industry produces textile goods from cotton.
Industries are divided into two broad categories:
(ii) Secondary industries.
Primary industries include all those activities which are connected with extraction, producing and processing of natural resources. These industries may be further sub-divided into two types- (a) extractive and (b) genetic. Secondary industries are concerned with the materials which have already been produced at the primary stage. For example, mining of iron ore is a primary industry, but manufacture of steel is a secondary industry.
Characteristics of Industry: The main characteristics of industry are as follows:
1. Industry refers to the productive aspect of business.
2. Production is done by the application of human or mechanical power.
3. It creates form utility to natural or partly processed goods.
4. It is concerned with the production of both producer and consumer goods.
5. Industrial activities are regulated by different laws.
6. It involves continuous operation.
Commerce
It refers to all those activities which help directly or indirectly in the distribution of goods to the ultimate consumer. It provides the necessary link between producers and consumers.
It embraces all those activities which are necessary for maintaining free flow of goods and services.
In general, commerce includes both Trade (Buying and Selling of goods) and Auxiliaries to trade (activities that are required to facilitate the purchase and sale of goods).
Characteristics of Commerce: The main characteristics of the trade are as follows:
1. Commerce consist of activities which help in removing hindrances in the process of exchange for maintaining free flow of goods and services.
2. Commerce is the sum total of activities which facilitate the availabilty of goods to consumers from different producers.
3. It aims at ensuring proper distribution of goods.
4. It adds different type of utilities to the goods by making goods available at the right time and the right place to the people who need them.
5. It includes trade and auxiliary to trade.
Trade
It involves the buying and selling of goods. It is an integral part of commerce. It helps in making the goods produced available to ultimate consumers or users.
In the absence of trade, it would not be possible to undertake production activities on a large scale.
It can be classified as:
1. Internal or Home trade
2. External or foreign trade
Characteristics of Trade- The main characteristics of trade and as follows:
1. Trade is regarded as the primary activity in commerce;
2. It means exchange of goods and services for price;
3. It helps in directing the flow of goods to the most profitable market:
4. It helps to equalise the supply of and demand for goods in different markets both national and international.
