Business, Commerce & Trade.

What is a business ?

Griffin and Ebert (1996): "Business is an organisation that provides goods or services in order to earn profit". It is a commercial activity of making one's living or making money through trading , manufacturing or providing services. The element of risk is also involved in it.

According to Peter F. Drucker :

• "There is only one valid definition of business purpose : to create a customer". Quality in a product or service is not what the supplier puts in . It is what customer gets out and is willing to pay for.
• " It either helps them grow or stunts them"
• "Change that creates a new dimension of performance"

Commerce :

Commerce includes all those activities which are helpful in transferring goods from place of production to the consumer. Purchases , sale , transportations , advertisement  are the activities which come within the scope of commerce.

Trade:

Trade is an important part of commerce. It means the exchange of goods and/or services, at either wholesale or retail, within a country or between countries.

BUSINESS use not only trade but commerce as well.

Domestic trade: 
A domestic trade or business is one where economic transactions are conducted within the geographical boundaries of the country. Home trade usually doesn't have any restrictions on movement inside the country and as requires fewer documentations & approval from government to transfer the goods.
It helps in increasing the employment & specialisation within the country which leads to economic development and self sufficiency.

International trade:

International trade represents the sale and transfer of goods, services and capital across international borders. In other words , imports and exports. It leads to economic interdependence between the countries . However due to uneven distribution of natural resources, difference in climatic and technological conditions in different countries cross border trading has become a necessity .

It leads to :

(1. ) international division of labour and specialisation.

(2.) expansion of market for product offered (including services). 

(3.)helps boost nations wealth and living standard of people.

(4.)maintains Balance Of Payment position ; export brings inflow of foreign exchange while imports results in outflow of them.

Foreign trade is subjected to many restrictions on free entry of goods & many taxes and duties have to be paid to trade between countries.