Meaning, Scope and Functions of Commerce

Back to: COMMERCE SS1

 

Welcome to class! 

In today’s class, we will be talking about the meaning, scope and functions of commerce. Enjoy the class!

Meaning, Scope and Functions of Commerce

• The Importance of Commerce
• History of Commerce in Nigeria /West Africa
• Divisions of Commerce

Definition of commerce

Commerce is the study of production, distribution and exchange of goods and services aimed at satisfying human wants and to earn a living.

The importance (functions) of commerce

1. It provides employment opportunities for people.
2. It makes production and exchange of goods and services possible.
3. It improves the standard of living of people by making modern goods
available.
4. It aids national and international co-operation by ensuring the inter-dependence of
nations.
5. It facilitates the division of labour and specialization.
6. It brings technological innovation and aids infrastructural development.

Stages in the history and development of commerce

(i) Earliest time: – Production was subsistent.
(ii) Exchange of goods and services by barter.
(iii) Exchange of goods and services through the use of commodity money.
(iv) Introduction of money – notes and coins as a medium of exchange
(v) Improvement in aids to trade.

Self-evaluation:
1. What is Commerce?
2. State four functions of Commerce.

Factors that delayed the development of commerce in Nigeria/West Africa

1. Political instability
2. Low savings
3. Absence of developed markets
4. Poor communication system
5. Illiteracy
6. Inadequate capital
7. Low level of technology
8. Inadequate infrastructural facilities / poor infrastructural facilities
9. Low National income

Factors that have contributed to the growth of commerce in Nigeria/West Africa

1. Development of modern techniques of production
2. Political stability
3. Development of financial institutions
4. Development of efficient means of transportation and communication
5. Availability of warehousing facilities
6. Improvements in aids to trade,e.g. Insurance, Advertising etc
7. Advancement in levels of education/literacy

Divisions of Commerce

Commerce can be grouped into two main branches or divisions, namely:
1. Trade
2. Aids to trade
The aids to trade can be subdivided into:
(a) Transport (b) Insurance (c) Banking and Finance (d) Advertising
(e) Warehousing (f) Communication (g) Tourism

Self-evaluation:
1. Why is Commerce so essential to modern society?
2. Set out carefully the principal divisions of Commerce and give an idea of the
relative importance of each division.

General self-evaluation:

1. What is Commerce?
2. State and explain the importance of any five ancillary services to trade.
3. Give any five advantages of advertising.
4. State five ways in which warehousing is useful to businessmen.
5. In what ways does transport aid trade.

Reading assignment

1. Essential Commerce for SSS by O.A. Longe Page 1-8
2. Comprehensive Commerce for SSS by J.U Anyaele Page 29-36

Theory

1. State three ancillary services to trade.
2. Mention three ways by which transport aids to trade.

 

In our next class, we will be talking about the Occupation.  We hope you enjoyed the class.

Should you have any further question, feel free to ask in the comment section below and trust us to respond as soon as possible.

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