What is the difference between business commerce trade?

Answer 1

Trade is the building block of both business and commerce, as well as the economy in general. Trade involves the exchage of goods, services or currency. In the most basic form it can be carried off without words. Both parties approach with goods to trade. Each proposes an amount of their own goods, as well as pointing to what they want from the other guy. Each is allowed to add or remove from their proposal until both are satisfied and the goods are swaped. In modern terms, trade is usually performed at a distance through money. I provide a service for which I am paid. I use that money to purchase goods which I want. The store which sells them to me uses the money to purchase additional goods or services. Effectively, the person for whom I performed the services has traded for the goods and services which the store wanted. It all happened by the exchange of ready cash.

Commerce is trade over long distances. In local areas a commodity (thing you trade) may not be worth as much as it is in another area. By trading for the good in one place, moving the good to another place and selling it at a higher price, the trader has just made money. This is called commerce and in modern parlance it has come to mean any operation which is designed to earn money by trade. A commercial enterprise seeks to make money by trade (although sometimes we do it at such a distance through cash that we hardly see the actual trade anymore). Anything which is used in a trade in order to earn money is referred to as commercialized and thus "commercializing the holidays" means using the holidays as a way to improve profits.

Business, correctly stated by the previous answerer is, is the state of being busy. A business plan explains the flow of goods, services and cash through a business in order to 1) sustain the business in its current state and 2) hopefully make some additional money. For instance, a store uses credit to buy 10 TVs. It pays for advertising about the sale, and sales staff to sell the TVs. It then sells the TVs at a profit, pays off the creditor, replaces the money for the ads and payroll, hopefully making enough extra money to put some away for a rainy day. This is a mathematical equation: Total Sales of TVs - Total Cost of TVs = Profit margin. If the profit margin is positive the company makes money. If it is negative, the company loses money. A good business will do an excellent job keeping itself going (being busy) while maintaining a positive profit margin that will increase the worth of the business.