What are the Branches of Commerce?

Since commerce embraces all those activities of taking goods and services from the production centre to the consumption, a great deal of obstacles are crossed. In between these two ends the obstacles faced are difficulties of trade, transportation, distribution, finance, storage, insurance and publicity. The above mentioned difficulties are removed by the various branches of commerce. These branches are:

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Trade: The channel through which goods are passed from the producer to the consumer is termed as trade. It is the agency which facilitate proper flow of goods. Trade involves buying and selling of goods.

Transport: Goods produced at the end of the producer are passed to the consumer with the help of transport facilities. The goods are transported from the place of low demand to the place of greater demand. Transport helps in the creation of place utility for the products. The growth of commerce largely vest on proper modes of transport like road, rail, sea and air.


Distribution: It is not possible on part of the producers to make direct contact with the consumers which are millions in numbers. A chain of middlemen like wholesalers, retailers, brokers and other agents help in the process of distribution of goods. The hindrances of persons is being removed with the help of different middlemen.

Insurance: A great deal of risks are involved during the course of transportation of goods. The risks in connection with goods are risks of fire or theft. These risks develop a state of fear of losses and these losses are covered by the help of insurance.

Advertisement: Since the consumers are scattered over distant places, they may not be aware of the availability of goods. Absence of knowledge of product puts a lot of hindrances on purchase of goods and this hindrance of knowledge is removed by advertisement and publicity.

Banking: There is a time lag between the production and sale of goods and during this period, the need of finance exert a great deal of influences. The commercial banks and the other schedule banks play a vital role in mitigating these financial crises. Banks also facilitate in international trade by providing long-term financial assistances.


Warehousing: The production of goods takes place in the anticipation of demand and goods are produced during the period of less demand. There is a growing need to store the goods in a warehouse so that those can be utilized during the period of more demand. The facility of warehouse removes the hindrances of time. The need for warehouse is greater in foreign trade because there is more time gap between production and consumption.

Communication: The buyers and sellers are intimated through various communicating agencies. The producer intimate the buyer about the production of goods, and the buyer sends orders for supply of goods. The post office, telephone, telex and fax helps in communication between the producer and consumers.

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