Understanding Trade and Management: Key Elements and Influences

Trade: increases the GDP and provides jobs

What is trade: Buying and selling of products and services to satisfy the needs of the population

-Domestic trade: commerce inside a country

-International trade: transactions between states

Elements of trade:

• Sellers: have the goods they want to sell
• Buyers: individuals who want to buy the goods
• Goods: Products that are bought or sold for money
• Markets: commercial transactions take place (physical or non-physical)

Factors that influence trade:

• Efficient infrastructure that gets goods to consumers in the shortest time possible
• Purchasing power and confidence: people with well-paid jobs can spend more money
• Large markets with potential consumers increase business confidence
• Prices, taxes, advertising, and discounts also affect sales

What is domestic trade:

Commerce that happens inside a country's borders. It creates jobs. In Spain, the food industry is the largest sector of domestic trade.

Wholesalers:

Large distribution companies buy enormous quantities of goods from producers and sell them to shops. They are intermediaries between producers and consumers.

Retailers:

• Buy small numbers of goods from wholesalers and sell them to the public
• Traditional retailers: small family shops
• Department stores offer consumers a huge range of products
• Large shopping centers: usually located on the outskirts of the cities
• Street markets: in the open air on a particular day each week

Consumption in Spanish households:

EPF calculates how much money households spend on certain goods and services. Household spending is grouped according to an international classification. This allows comparisons with other countries and to see how prices have evolved.

International trade indicators:

Value of trade between countries is shown in:

• Balance of trade - difference in value between the goods the country exports vs imports
• Balance of payments - all of the country's monetary transactions (goods...)

Types of internal trade:

Includes the movement of visible goods and services and those that are abstract

Trade in visible goods and services:

Includes energy sources and manufactured products

International trade in a global market:

Areas:

• EEUU: world's main importer and second largest exporter
• Central and South America: trading more and more with US EEUU, China, and Japan
• EU: World's largest trading bloc
• CIS: organization that trades mostly with EU and Asian countries
• Africa: contributes little to international trade because of its level of poverty
• Middle East: the largest oil-producing countries
• South Asia (ASEAN): a trade bloc whose objective is to promote trade with other commercial blocs