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Commerce
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This article is about the business concept. For other uses, see Commerce (disambiguation).
This article needs additional citations for verification.

Please help improve this article by adding reliable references. Unsourced material may be challenged
and removed. (March 2007)
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Commerce is a division of trade or production which deals with the exchange of goods and
services from producer to final consumer OR commerce is the exchange of goods and services
from the point of production to the point of consumption to satisfy human wants. It comprises
the trading of something of economic value such as goods, services, information, or money
between two or more entities. Commerce functions as the central mechanism which drives
capitalism and certain other economic systems (but compare command economy, for example).
Commercialization or commercialisation consists of the process of transforming something
into a product, service or activity which one may then use in commerce. Commerce involves
trade and aids to trade which help in the exchange of goods and services.
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Word usage
Commerce primarily expresses the fairly abstract notions of buying and selling, whereas trade
may refer to the exchange of a specific class of goods ("the sugar trade", for example), or to a
specific act of exchange (as in "a trade on the stock-exchange").
Business can refer to an organization set up for the purpose of engaging in manufacturing or
exchange, as well as serving as a loose synonym of the abstract collective "commerce and
industry".
History
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Cherry peddler in Bucharest, around 1869.

Some commentators trace the origins of commerce to the very start of communication in
prehistoric times. Apart from traditional self-sufficiency, trading became a principal facility of
prehistoric people, who bartered what they had for goods and services from each other. Historian
Peter Watson dates the history of long-distance commerce from circa 150,000 years ago. [1]
In historic times, the introduction of currency as a standardized money facilitated a wider
exchange of goods and services. Numismatists have collections of these monies, which include
coins from some Ancient World large-scale societies, although initial usage involved unmarked
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lumps of precious metal. [2] The circulation of a standardized currency provides the major
disadvantage to commerce of overcoming the "double coincidence of wants" necessary for barter
trades to occur. For example, if a man who makes pots for a living needs a new house, he may
wish to hire someone to build it for him. But he cannot make an equivalent number of pots to
equal this service done for him, because even if the builder could build the house, the builder
might not want the pots. Currency solved this problem by allowing a society as a whole to assign
values and thus to collect goods and services effectively and to store them for later use, or to split
them among several providers.
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Today[update] commerce includes a complex system of companies that try to maximize their profits
by offering products and services to the market (which consists both of individuals and other
companies) at the lowest production-cost. There exists a system of　International trade, which
some argue has gone too far. But in the recent times commerce has taken shape to help in the
development of the world economy.
Business
From Wikipedia, the free encyclopedia
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For other uses, see Business (disambiguation).

"Firm" redirects here. For other uses, see The Firm (disambiguation).
This article has multiple issues. Please help improve it or discuss these issues on the
talk page.
• It needs additional references or sources for verification. Tagged since September
2008.
• It may require general cleanup to meet Wikipedia's quality standards. Tagged
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since February 2009.
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Companies law
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Company · Business
Sole proprietorship
Partnership
(General · Limited · LLP)
Corporation
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Cooperative
United States
S corporation · C corporation
LLC · LLLP · Series LLC
Delaware corporation
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Nevada corporation
Massachusetts business trust
UK / Ireland / Commonwealth
Limited company
(by shares · by guarantee
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Public · Proprietary)
Unlimited company
Community interest company
European Union / EEA
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SE · SCE · SPE · EEIG
Elsewhere
AB · AG · ANS · A/S · AS · GmbH

K.K. · N.V. · OY · S.A. · more
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Doctrines
Corporate governance
Limited liability · Ultra vires
Business judgment rule
Internal affairs doctrine
De facto corporation and

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corporation by estoppel
Piercing the corporate veil

Rochdale Principles
Related areas
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Contract · Civil procedure
v•d•e
A business (also known as a company, enterprise, and firm) is a legally recognized

organization designed to provide goods or services, or both, to consumers, businesses and
governmental entities.[1] Businesses are predominant in capitalist economies. Most businesses are
privately owned. A business is typically formed to earn profit that will increase the wealth of its
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owners and grow the business itself. The owners and operators of a business have as one of their
main objectives the receipt or generation of a financial return in exchange for work and
acceptance of risk. Notable exceptions include cooperative enterprises and state-owned
enterprises. Businesses can also be formed not-for-profit or be state-owned.
The etymology of "business" relates to the state of being busy either as an individual or society
as a whole, doing commercially viable and profitable work. The term "business" has at least
three usages, depending on the scope — the singular usage (above) to mean a particular company
or corporation, the generalized usage to refer to a particular market sector, such as "the music
business" and compound forms such as agribusiness, or the broadest meaning to include all
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activity by the community of suppliers of goods and services. However, the exact definition of
business, like much else in the philosophy of business, is a matter of debate and complexity of
meanings.
Contents
[hide]
• 1 Basic forms of ownership
• 2 Classifications
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• 3 Management
○ 3.1 Reforming State Enterprises
• 4 Government regulation
○ 4.1 Organizing
○ 4.2 Commercial law
○ 4.3 Capital
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○ 4.4 Intellectual property

○ 4.5 Exit plans
• 5 See also
• 6 Notes and references
• 7 External links
[edit] Basic forms of ownership

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Although forms of business ownership vary by jurisdiction, there are several common forms:
• Sole proprietorship: A sole proprietorship is a business owned by one person. The
owner may operate on his or her own or may employ others. The owner of the business
has personal liability of the debts incurred by the business.
• Partnership: is a form of business in which two or more people operate for the common
goal which is often making profit. In most forms of partnerships, each partner has
personal liability of the debts incurred by the business. There are three typical
classifications of partnerships: general partnerships, limited partnerships, and limited
liability partnerships.
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• Corporation: is either a [limited liability|limited] or unlimited liability entity that has a

separate [legal personality] from its members. A corporation can be organized for-profit
or not-for-profit. A corporation is owned by multiple shareholders and is overseen by a
board of directors, which hires the business's managerial staff. In addition to privately
owned corporate models, there are state-owned corporate models.
• Cooperative: Often referred to as a "co-op", a cooperative is a limited liability entity that
can organize for-profit or not-for-profit. A cooperative differs from a corporation in that
it has members, as opposed to shareholders, who share decision-making authority.
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Cooperatives are typically classified as either consumer cooperatives or worker

cooperatives. Cooperatives are fundamental to the ideology of economic democracy.
For a country-by-country listing of legally recognized business forms, see Types of business
entity.
[edit] Classifications
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Wall Street, Manhattan is the location of the New York Stock Exchange and is often used as a
symbol for the world of business.
There are many types of businesses, and because of this, businesses are classified in many ways.
One of the most common focuses on the primary profit-generating activities of a business:
• Agriculture and mining businesses are concerned with the production of raw material,
such as plants or minerals.
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• Financial businesses include banks and other companies that generate profit through
investment and management of capital.
• Information businesses generate profits primarily from the resale of intellectual property
and include movie studios, publishers and packaged software companies.
• Manufacturers produce products, from raw materials or component parts, which they then
sell at a profit. Companies that make physical goods, such as cars or pipes, are considered
manufacturers.
• Real estate businesses generate profit from the selling, renting, and development of
properties, homes, and buildings.
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• Retailers and Distributors act as middle-men in getting goods produced by manufacturers

to the intended consumer, generating a profit as a result of providing sales or distribution
services. Most consumer-oriented stores and catalogue companies are distributors or
retailers. See also: Franchising
• Service businesses offer intangible goods or services and typically generate a profit by
charging for labor or other services provided to government, other businesses, or
consumers. Organizations ranging from house decorators to consulting firms, restaurants,
and even entertainers are types of service businesses.
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• Transportation businesses deliver goods and individuals from location to location,

generating a profit on the transportation costs
• Utilities produce public services, such as heat, electricity, or sewage treatment, and are
usually government chartered.
There are many other divisions and subdivisions of businesses. The authoritative list of business
types for North America is generally considered to be the North American Industry
Classification System, or NAICS. The equivalent European Union list is the NACE.
[edit] Management
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The efficient and effective operation of a business, and study of this subject, is called
management. The main branches of management are financial management, marketing
management, human resource management, strategic management, production management,
operation management, service management and information technology management.
[edit] Reforming State Enterprises
In recent decades, assets and enterprises that were run by various states have been modeled after
business enterprises. In 2003, the People's Republic of China reformed 80% of its state-owned
enterprises and modeled them on a company-type management system.[2] Many state institutions
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and enterprises in China and Russia have been transformed into joint-stock companies, with part
of their shares being listed on public stock markets.
[edit] Government regulation
This section may require cleanup to meet Wikipedia's quality standards. Please
improve this section if you can. (August 2007)
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The examples and perspective in this section may not represent a worldwide view of
the subject. Please improve this article and discuss the issue on the talk page. (May
2009)
Most legal jurisdictions specify the forms of ownership that a business can take, creating a body
of commercial law for each type.
[edit] Organizing
The major factors affecting how a business is organized are usually:
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The Bank of England in Threadneedle Street, London, England.

• The size and scope of the business, and its anticipated management and ownership.
Generally a smaller business is more flexible, while larger businesses, or those with
wider ownership or more formal structures, will usually tend to be organized as
partnerships or (more commonly) corporations. In addition a business that wishes to raise
money on a stock market or to be owned by a wide range of people will often be required
to adopt a specific legal form to do so.
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• The sector and country. Private profit making businesses are different from government
owned bodies. In some countries, certain businesses are legally obliged to be organized in
certain ways.
• Limited liability. Corporations, limited liability partnerships, and other specific types of
business organizations protect their owners or shareholders from business failure by
doing business under a separate legal entity with certain legal protections. In contrast,
unincorporated businesses or persons working on their own are usually not so protected.
• Tax advantages. Different structures are treated differently in tax law, and may have
advantages for this reason.
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• Disclosure and compliance requirements. Different business structures may be

required to make more or less information public (or reported to relevant authorities), and
may be bound to comply with different rules and regulations.
Many businesses are operated through a separate entity such as a corporation or a partnership
(either formed with or without limited liability). Most legal jurisdictions allow people to organize
such an entity by filing certain charter documents with the relevant Secretary of State or
equivalent and complying with certain other ongoing obligations. The relationships and legal
rights of shareholders, limited partners, or members are governed partly by the charter
documents and partly by the law of the jurisdiction where the entity is organized. Generally
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speaking, shareholders in a corporation, limited partners in a limited partnership, and members in

a limited liability company are shielded from personal liability for the debts and obligations of
the entity, which is legally treated as a separate "person." This means that unless there is
misconduct, the owner's own possessions are strongly protected in law, if the business does not
succeed.
Where two or more individuals own a business together but have failed to organize a more
specialized form of vehicle, they will be treated as a general partnership. The terms of a
partnership are partly governed by a partnership agreement if one is created, and partly by the
law of the jurisdiction where the partnership is located. No paperwork or filing is necessary to
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create a partnership, and without an agreement, the relationships and legal rights of the partners
will be entirely governed by the law of the jurisdiction where the partnership is located.
A single person who owns and runs a business is commonly known as a sole proprietor, whether
he or she owns it directly or through a formally organized entity.
A few relevant factors to consider in deciding how to operate a business include:
1. General partners in a partnership (other than a limited liability partnership), plus anyone
who personally owns and operates a business without creating a separate legal entity, are
personally liable for the debts and obligations of the business.
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2. Generally, corporations are required to pay tax just like "real" people. In some tax
systems, this can give rise to so-called double taxation, because first the corporation pays
tax on the profit, and then when the corporation distributes its profits to its owners,
individuals have to include dividends in their income when they complete their personal
tax returns, at which point a second layer of income tax is imposed.
3. In most countries, there are laws which treat small corporations differently than large
ones. They may be exempt from certain legal filing requirements or labor laws, have
simplified procedures in specialized areas, and have simplified, advantageous, or slightly
different tax treatment.
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4. To "go public" (sometimes called IPO) -- which basically means to allow a part of the
business to be owned by a wider range of investors or the public in general—you must
organize a separate entity, which is usually required to comply with a tighter set of laws
and procedures. Most public entities are corporations that have sold shares, but
increasingly there are also public LLCs that sell units (sometimes also called shares), and
other more exotic entities as well (for example, REITs in the USA, Unit Trusts in the
UK). However, you cannot take a general partnership "public."
[edit] Commercial law
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Offices in the Los Angeles Downtown Financial District

Most commercial transactions are governed by a very detailed and well-established body of rules
that have evolved over a very long period of time, it being the case that governing trade and
commerce was a strong driving force in the creation of law and courts in Western civilization.
As for other laws that regulate or impact businesses, in many countries it is all but impossible to
chronicle them all in a single reference source. There are laws governing treatment of labor and
generally relations with employees, safety and protection issues (Health and Safety), anti-
discrimination laws (age, gender, disabilities, race, and in some jurisdictions, sexual orientation),
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minimum wage laws, union laws, workers compensation laws, and annual vacation or working
hours time.
In some specialized businesses, there may also be licenses required, either due to special laws
that govern entry into certain trades, occupations or professions, which may require special
education, or by local governments. Professions that require special licenses range from law and
medicine to flying airplanes to selling liquor to radio broadcasting to selling investment
securities to selling used cars to roofing. Local jurisdictions may also require special licenses and
taxes just to operate a business without regard to the type of business involved.
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Some businesses are subject to ongoing special regulation. These industries include, for example,
public utilities, investment securities, banking, insurance, broadcasting, aviation, and health care
providers. Environmental regulations are also very complex and can impact many kinds of
businesses in unexpected ways.
[edit] Capital
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Mexican Stock Exchange in Paseo de la Reforma, Mexico City

When businesses need to raise money (called 'capital'), more laws come into play. A highly
complex set of laws and regulations govern the offer and sale of investment securities (the means
of raising money) in most Western countries. These regulations can require disclosure of a lot of
specific financial and other information about the business and give buyers certain remedies.
Because "securities" is a very broad term, most investment transactions will be potentially
subject to these laws, unless a special exemption is available.
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Capital may be raised through private means, by public offer (IPO) on a stock exchange, or in
many other ways. Major stock exchanges include the Shanghai Stock Exchange, Singapore
Exchange, Hong Kong Stock Exchange, New York Stock Exchange and Nasdaq (USA), the
London Stock Exchange (UK), the Tokyo Stock Exchange (Japan), and so on. Most countries
with capital markets have at least one.
Business that have gone "public" are subject to extremely detailed and complicated regulation
about their internal governance (such as how executive officers' compensation is determined) and
when and how information is disclosed to the public and their shareholders. In the United States,
these regulations are primarily implemented and enforced by the United States Securities and
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Exchange Commission (SEC). Other Western nations have comparable regulatory bodies. The
regulations are implemented and enforced by the China Securities Regulation Commission
(CSRC), in China. In Singapore, the regulation authority is Monetary Authority of Singapore
(MAS), and in Hong Kong, it is Securities and Futures Commission (SFC).
As noted at the beginning, it is impossible to enumerate all of the types of laws and regulations
that impact on business today. In fact, these laws have become so numerous and complex, that
no business lawyer can learn them all, forcing increasing specialization among corporate
attorneys. It is not unheard of for teams of 5 to 10 attorneys to be required to handle certain kinds
of corporate transactions, due to the sprawling nature of modern regulation. Commercial law
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spans general corporate law, employment and labor law, healthcare law, securities law, M&A
law (who specialize in acquisitions), tax law, ERISA law (ERISA in the United States governs
employee benefit plans), food and drug regulatory law, intellectual property law (specializing in
copyrights, patents, trademarks and such), telecommunications law, and more.
In Thailand, for example, it is necessary to register a particular amount of capital for each
employee, and pay a fee to the government for the amount of capital registered. There is no legal
requirement to prove that this capital actually exists, the only requirement is to pay the fee.
Overall, processes like this are detrimental to the development and GDP of a country, but often
exist in "feudal" developing countries.
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[edit] Intellectual property

Businesses often have important "intellectual property" that needs protection from competitors
for the company to stay profitable. This could require patents or copyrights or preservation of
trade secrets. Most businesses have names, logos and similar branding techniques that could
benefit from trademarking. Patents and copyrights in the United States are largely governed by
federal law, while trade secrets and trademarking are mostly a matter of state law. Because of the
nature of intellectual property, a business needs protection in every jurisdiction in which they are
concerned about competitors. Many countries are signatories to international treaties concerning
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intellectual property, and thus companies registered in these countries are subject to national
laws bound by these treaties.
[edit] Exit plans
Businesses can be bought and sold. "Exit plan" describes how business owners refer to disposing
of their business. Common exit plans include IPOs, MBOs and mergers with other businesses.
Businesses are rarely liquidated, as it is often unprofitable to do so
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E-commerce taking wings in India

The potential and threats on the e-commerce front
Tuesday, February 23, 2010
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Though e-commerce has immense potential, there are many factors that hinder its
growth, says Pankaj Narayan Pandit, head - Airlines Vertical, Sonata Software
Limited. Excerpts from an interview to Sudhakaran of CyberMedia News:
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E-commerce is the in-thing in the new-age economic system, but do you think India is geared up to tap
the potential of it?
E-commerce offers unprecedented opportunities for the travel sector in both developing and developed
countries. However, it is still in its nascent stage in India. Low Internet and PC penetration, lack of
broadband network, security concerns on the use of credit card, low ‘bookers to lookers ratio’ are some of
the factors inhibiting the growth of e-commerce in India.
Being the head the Airlines vertical at Sonata Software, how do you look at the possibility of e-commerce in
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the airline industry?
The dawn of the Internet era has significantly changed the way travelers and airlines around the world
interact with each other. GDS channel was earlier the only medium of transferring data. This has now been
supplemented by a wider range of IP-based applications termed as e-commerce. The Internet has created a
new economic ecosystem, the e-commerce marketplace, and it has become the virtual main street of the
world.
Providing a quick and convenient way of exchanging goods and services both regionally and globally, e-
commerce has boomed. The travel industry has benefited hugely through the growth surge in e-commerce.
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According to IDC, online sales of airline tickets, car rentals, and hotel reservations make the travel industry
one of the strongest e-commerce markets in existence today.
Airlines were the earliest practitioners of large-scale computerization and e-commerce. In the late nineties,
travel websites such as Expedia and Travelocity emerged as the most popular website brands in the Internet
travel marketplace. Today the adoption of e-commerce technologies by low-cost airlines to facilitate direct
sales has accelerated their market penetration. These airlines are already selling majority of their seats
through online channels. On the other hand the network airlines (or mainline airlines) are able to sell less
than 15 per cent of their tickets using online channels.
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There are many reasons why mainline airlines are not able to tap the full potential of e-commerce, like,
complexity of their business model and complexity of fares and also the dependence on traditional travel
agents.
As per airline IT trends survey, airlines have sold 49.9 per cent of tickets through GDS channels, 26 per cent
through all web channels in 2009. However, this break up is expected to change to 37 per cent and 41 per
cent respectively by 2013. To make this happen, airlines have turned to e-commerce, or e-distribution
channels, thereby reducing their dependency on GDS/travel agents.
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rfrth said on 7/13/2010 9:23:13

AM:
i hate e commerce
to rfrth
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Is E-Commerce Truly Good for the

Planet?
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• Is E-Commerce Truly Good for the Planet?

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By Marc Gunther at Greener World Media

Tue Sep 14, 2010 1:00am EDT
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I'm not much of a shopper, but when I buy stuff, I prefer to do it online.
I don't like shopping malls, driving in traffic, crowded stores or dealing
with "customer service" people. I do enjoy getting packages at home.
Now, it turns out, there may be another reason to shop online: E-commerce is a way to
help fight climate change.
So, at least, says eBay and a carbon-footprint consulting firm called Cooler, in a report
due out today. In particular, the report argues, eBay's business of enabling peer-to-peer
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selling and small retailers generates significant environmental value. You'd expect eBay
to say that, of course, but there's logic behind the claim. The report says:
By minimizing infrastructure, reducing the need for warehousing, and maximizing
transportation efficiency, small online retailers have created a climate-friendly way to
buy and sell. All-electronic, with no need for everything from mannequins to signage to
giant rooftop air conditioning units, they have dematerialized considerable parts of the
retail process.
This morning, I'll be moderating a discussion about the study at the National Press Club
with John Donahoe, eBay’s president and CEO; Michel Gelobter, the founder of Cooler
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and author of the white paper; and Eileen Claussen, president of the Pew Center on
Global Climate Change. [Disclosure: eBay is paying me to host the event.]
This Washington showcase for Donahoe, to which environmental leaders have been
invited, is the latest effort by eBay's to position itself as an environmentally-friendly
company, largely because it sells used products. [See my blogpost Why eBay is a
Green Giant and this GreenBiz.com interview with Donahoe.] To its credit, eBay is also
a founding member of BICEP, a coalition of companies pushing for climate change
regulation.
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I have to admit that I was skeptical about eBay's claim that e-commerce is climate-
friendly when I heard about it from Amy Skoczlas Cole, who leads eBay's Green Team.
After all, aren't big retailers like Walmart renowned for their efficiency, their logistics,
their fine-tuned global supply chains? The economies of scale and all that?
Well, yes, but peer-to-peer retailers -- the small businesses supported by eBay -- tend
to be pretty efficient, too, because they have to be. (The last time I bought a book online
from a small store, it came in a previously-used box.)
!--pagebreak--
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These small e-tailers operate out of their own homes and garages. They don't need big
parking lots of warehouses. They ship by delivery services like UPS, FedEx and the
post office which move goods around a lot more efficiently than suburban shoppers do
when they drive to and from a big-box store.
They're also a force in the economy. In 2009, the report says, peer-to-peer online sales
operations generated more than $31 billion in sales and despite the recession, their
revenues grew, as did their market share of all online sales, to about 20.9 percent.
Using admittedly rough estimates, the report says:
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Compared to a single big box retail store grossing $100 million per year, the day-to-day
operations of $100 million in sales through Web-based peer-to-peer marketplaces
generate approximately 1,400 tons fewer CO2-equivalent emissions per year.
Three types are savings are significant, the report argues:
1. Without the need for stores, or chains of them, peer-to-peer retailing saves everything
from the carbon cost of making bricks and cements to the everyday costs of heating and
lighting retail spaces, not to mention the giant neon signs outside big box stores.
2. Warehousing in garages and spare rooms can eliminate big warehouses that eat up
land and consume energy
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3. Home deliver is more efficient than people driving mostly empty cars around.
I'll be interested to learn more during today’s discussion. Did Cooler take the energy
costs of operating the data centers than run the Internet, as well as individual home
computers into account? How much of eBay's business comes from the mom-and-pop
retailers, and how much from big companies that operate warehouses and manage
global supply chains? And, while the big box model has its obvious problems, shouldn't
green consumers at least consider supporting retailers like Walmart and Best Buy that
use their clout to promote environmentally-friendly practices. (See Walmart, bully for
good and Best Buy wants your electronic junk at fortune.com.) Will peer-to-peer sellers
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recycle phones as Sprint does, or support sustainable forestry practices as Staples

does?
None of this is simple. I love the fact that eBay sells used stuff -- that's almost surely
better than buying new -- and I'll remain a fan of Internet shopping. But let's not forget
that when it comes to saving the planet, the best buying decision we can make is not to
buy at all.
Background image CC licensed by Flickr user kathryn in stereo. Logo courtesy of eBay.
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Japan intervenes to weaken yen for 1st time in 6 years

TOKYO (Reuters) - Japan sold the yen in the market on Wednesday for the first time in six years,
trying to stop the currency's relentless climb from hurting exporters and threatening a fragile
economic recovery.
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Is E-Commerce Truly Good for the Planet?
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By Marc Gunther at Greener World Media
Tue Sep 14, 2010 1:00am EDT
I'm not much of a shopper, but when I buy stuff, I prefer to do it online. I don't like
shopping malls, driving in traffic, crowded stores or dealing with "customer service"
people.
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Now, it turns out, there may be another reason to shop online: E-commerce is a way
to help fight climate change.
So, at least, says eBay and a carbon-footprint consulting firm called Cooler, in a
report due out today. In particular, the report argues, eBay's business of enabling
peer-to-peer selling and small retailers generates significant environmental value.
You'd expect eBay to say that, of course, but there's logic behind the claim. The
report says:
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By minimizing infrastructure, reducing the need for warehousing, and maximizing

transportation efficiency, small online retailers have created a climate-friendly way
to buy and sell. All-electronic, with no need for everything from mannequins to
signage to giant rooftop air conditioning units, they have dematerialized
considerable parts of the retail process.
This morning, I'll be moderating a discussion about the study at the National Press
Club with John Donahoe, eBay’s president and CEO; Michel Gelobter, the founder of
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Cooler and author of the white paper; and Eileen Claussen, president of the Pew
Center on Global Climate Change. [Disclosure: eBay is paying me to host the event.]
This Washington showcase for Donahoe, to which environmental leaders have been
invited, is the latest effort by eBay's to position itself as an environmentally-friendly
company, largely because it sells used products. [See my blogpost Why eBay is a
Green Giant and this GreenBiz.com interview with Donahoe.] To its credit, eBay is
also a founding member of BICEP, a coalition of companies pushing for climate
change regulation.
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I have to admit that I was skeptical about eBay's claim that e-commerce is climate-
friendly when I heard about it from Amy Skoczlas Cole, who leads eBay's Green
Team. After all, aren't big retailers like Walmart renowned for their efficiency, their
logistics, their fine-tuned global supply chains? The economies of scale and all that?
Well, yes, but peer-to-peer retailers -- the small businesses supported by eBay --
tend to be pretty efficient, too, because they have to be. (The last time I bought a
book online from a small store, it came in a previously-used box.)
!--pagebreak--
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These small e-tailers operate out of their own homes and garages. They don't need
big parking lots of warehouses. They ship by delivery services like UPS, FedEx and
the post office which move goods around a lot more efficiently than suburban
shoppers do when they drive to and from a big-box store.
They're also a force in the economy. In 2009, the report says, peer-to-peer online
sales operations generated more than $31 billion in sales and despite the recession,
their revenues grew, as did their market share of all online sales, to about 20.9
percent. Using admittedly rough estimates, the report says:
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Compared to a single big box retail store grossing $100 million per year, the day-to-
day operations of $100 million in sales through Web-based peer-to-peer
marketplaces generate approximately 1,400 tons fewer CO2-equivalent emissions
per year.
Three types are savings are significant, the report argues:
1. Without the need for stores, or chains of them, peer-to-peer retailing saves
everything from the carbon cost of making bricks and cements to the everyday
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costs of heating and lighting retail spaces, not to mention the giant neon signs
outside big box stores.
2. Warehousing in garages and spare rooms can eliminate big warehouses that eat
up land and consume energy
3. Home deliver is more efficient than people driving mostly empty cars around.
I'll be interested to learn more during today’s discussion. Did Cooler take the energy
costs of operating the data centers than run the Internet, as well as individual home
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computers into account? How much of eBay's business comes from the mom-and-
pop retailers, and how much from big companies that operate warehouses and
manage global supply chains? And, while the big box model has its obvious
problems, shouldn't green consumers at least consider supporting retailers like
Walmart and Best Buy that use their clout to promote environmentally-friendly
practices. (See Walmart, bully for good and Best Buy wants your electronic junk at
fortune.com.) Will peer-to-peer sellers recycle phones as Sprint does, or support
sustainable forestry practices as Staples does?
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None of this is simple. I love the fact that eBay sells used stuff -- that's almost
surely better than buying new -- and I'll remain a fan of Internet shopping. But let's
not forget that when it comes to saving the planet, the best buying decision we can
make is not to buy at all.
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