Explanation of Traditional Commerce

Traditional commerce refers to the system of buying and selling goods and services in a physical marketplace or a brick-and-mortar store. It involves face-to-face interactions between buyers and sellers, with cash or credit card payments being made in person.

In traditional commerce, products are usually displayed on shelves or in storefronts, and customers can inspect and physically touch them before making a purchase. Sellers may engage in various marketing and sales tactics to attract customers, such as advertising, promotions, and discounts.

Traditional commerce has been the dominant form of commerce for many centuries, and it still remains an important aspect of the economy today. However, with the rise of e-commerce and online shopping, traditional commerce has faced increased competition and has had to adapt to changing consumer preferences and trends.

Commerce is the large-scale organized system of activities, functions, procedures and institutions which directly and indirectly contributes to the transfer of goods and services on a large scale and at the right time, place, quantity and price from the original producers to the final consumers within local, regional, national or international economies [1] More specifically, commerce is not business (i.e. an organization or activity whose goal is to sell manufactured goods and/or services for profit), but rather the part of business which is related to the movement and distribution of finished or intermediate (but valuable) goods and services from the primary manufacturers to the end customers on a large scale, as opposed to the sourcing of raw materials and manufacturing of those goods.

Commerce is different from trade as well. Trade is the transaction (buying and selling) of goods and services which makes a profit for the seller and satisfies the want or need of the buyer. When trade is carried out within a country, it is called home or domestic trade, which can be wholesale or retail. A wholesaler buys from the producer in bulk and sells to the retailer who then sells again to the final consumer in smaller quantities. Trade between a country and the rest of the world is called foreign or international trade, which consists of import trade and export trade, both being wholesale in general. Commerce not only includes trade as defined above, but also the auxiliary services and means which facilitate such trade. These auxiliary services include transportation, communication, warehousing, insurance, banking, financial markets, advertising, packaging, the services of commercial agents and agencies, etc. In other words, commerce encompasses a wide array of political, economical, technological, logistical, legal, regulatory, social and cultural aspects of trade on a large scale. From a marketing perspective, commerce creates time and place utility by making goods and services available to the customers at the right place and at the right time by changing their location or placement. Described in this manner, trade is a part of commerce and commerce is a part of business.

Traditional commerce refers to the practice of selling products and services within a single industry and in some cases, within a specific geographical area. Traditional commerce relies on operating business hours during a specific period of time and requires housing inventory or occupying a retail store.

In contrast to e-commerce that relies on online sales, drop shipments and 24 hour access for consumers, traditional commerce relies more on local consumers interacting with sales executives, managers, customer service personnel and accountants personally versus through electronic mediums.

Businesses deemed as traditional commerce handle advertising, inventory shipping and creation of products and services in-house with a staff of employees in close proximity. Traditional commerce does not typically share information with competitors whereas e-commerce prices, specials and inventory are ready available online for consumers and competitors.

Traditional commerce often relies on face to face interaction with consumers and thrives based on word of mouth, networking and customer referrals for new and repeat business. Personal interaction is a key component of businesses experience success with traditional commerce. Many businesses network within the community, establish rapport with city leaders and chambers of commerce and sponsor local events and sports teams to develop a relationship with the community to draw in business.