About this blog
This blog introduces some knowledge about B2B or trade. Perhaps some people do not is not entirely clear about B2B. So I will do a simple introduction about b2b in the following.
business-to-business (B2B) describes commerce transactions between businesses, such as between a manufacturer and a wholesaler, or between a wholesaler and a retailer. Contrasting terms are business-to-consumer (B2C) and business-to-government (B2G).
The volume of B2B (Business-to-Business) transactions is much higher than the volume of B2C transactions. The primary reason for this is that in a typical supply chain there will be many B2B transactions involving sub components or raw materials, and only one B2C transaction, specifically sale of the finished product to the end customer. For example, an automobile manufacturer makes several B2B transactions such as buying tires, glass for windscreens, and rubber hoses for its vehicles. The final transaction, a finished vehicle sold to the consumer, is a single (B2C) transaction.
B2B is also used in the context of communication and collaboration. Many businesses are now using social media to connect with their consumers (B2C); however, they are now using similar tools within the business so employees can connect with one another. When communication is taking place amongst employees, this can be referred to as “B2B” communication.
With the development of economy, the foreign trade has become one kind of form of trade. Trade is the transfer of ownership of goods and services from one person or entity to another. Trade is sometimes loosely called commerce or financial transaction or barter. A network that allows trade is called a market. The original form of trade was barter, the direct exchange of goods and services. Later one side of the barter were the metals, precious metals (poles, coins), bill, paper money. Modern traders instead generally negotiate through a medium of exchange, such as money. As a result, buying can be separated from selling, or earning. The invention of money (and later credit, paper money and non-physical money) greatly simplified and promoted trade. Trade between two traders is called bilateral trade, while trade between more than two traders is called multilateral trade.
Trade exists for man due to specialization and division of labor, most people concentrate on a small aspect of production, trading for other products. Trade exists between regions because different regions have a comparative advantage in the production of some tradable commodity, or because different regions’ size allows for the benefits of mass production. As such, trade at market prices between locations benefits both locations.
Retail trade consists of the sale of goods or merchandise from a very fixed location, such as a department store, boutique or kiosk, or by mail, in small or individual lots for direct consumption by the purchaser.[1] Wholesale trade is defined as the sale of goods or merchandise to retailers, to industrial, commercial, institutional, or other professional business users, or to other wholesalers and related subordinated services.
Trading can also refer to the action performed by traders and other market agents in the financial markets.
Recently years, the international trade develops fast in China. The Doha round of World Trade Organization negotiations aims to lower barriers to trade around the world, with a focus on making trade fairer for developing countries. Talks have been hung over a divide between the rich developed countries, represented by the G20, and the major developing countries. Agricultural subsidies are the most significant issue upon which agreement has been hardest to negotiate. By contrast, there was much agreement on trade facilitation and capacity building. The Doha round began in Doha, Qatar, and negotiations have subsequently continued in: Cancún, Mexico; Geneva, Switzerland; and Paris, France and Hong Kong.
International trade is the exchange of goods and services across national borders. In most countries, it represents a significant part of GDP. While international trade has been present throughout much of history (see Silk Road, Amber Road), its economic, social, and political importance have increased in recent centuries, mainly because of Industrialization, advanced transportation, globalization, multinational corporations, and outsourcing. In fact, it is probably the increasing prevalence of international trade that is usually meant by the term “globalization”.
Empirical evidence for the success of trade can be seen in the contrast between countries such as South Korea, which adopted a policy of export-oriented industrialization, and India, which historically had a more closed policy (although it has begun to open its economy, as of 2005). South Korea has done much better by economic criteria than India over the past fifty years, though its success also has to do with effective state institutions.
Beginning around 1978, the government of the People’s Republic of China (PRC) began an experiment in economic reform. In contrast to the previous Soviet-style centrally planned economy, the new measures progressively relaxed restrictions on farming, agricultural distribution and, several years later, urban enterprises and labor. The more market-oriented approach reduced inefficiencies and stimulated private investment, particularly by farmers, that led to increased productivity and output. One feature was the establishment of four (later five) Special Economic Zones located along the South-east coast.
The reforms proved spectacularly successful in terms of increased output, variety, quality, price and demand. In real terms, the economy doubled in size between 1978 and 1986, doubled again by 1994, and again by 2003. On a real per capita basis, doubling from the 1978 base took place in 1987, 1996 and 2006. By 2008, the economy was 16.7 times the size it was in 1978, and 12.1 times its previous per capita levels. International trade progressed even more rapidly, doubling on average every 4.5 years. Total two-way trade in January 1998 exceeded that for all of 1978; in the first quarter of 2009, trade exceeded the full-year 1998 level. In 2008, China’s two-way trade totaled US$2.56 trillion.
In 1991 the PRC joined the Asia-Pacific Economic Cooperation group, a trade-promotion forum. In 2001, it also joined the World Trade Organization.
Trade sanctions
Trade sanctions against a specific country are sometimes imposed, in order to punish that country for some action. An embargo, a severe form of externally imposed isolation, is a blockade of all trade by one country on another. For example, the United States has had an embargo against Cuba for over 40 years.
Trade barriers
Although there are usually few trade restrictions within countries, international trade is usually regulated by governmental quotas and restrictions, and often taxed by tariffs. Tariffs are usually on imports, but sometimes countries may impose export tariffs or subsidies. All of these are called trade barriers. If a government removes all trade barriers, a condition of free trade exists. A government that implements a protectionist policy establishes trade barriers.
Fair trade
The fair trade movement, also known as the trade justice movement, promotes the use of labour, environmental and social standards for the production of commodities, particularly those exported from the Third and Second Worlds to the First World. Such ideas have also sparked a debate on whether trade itself should be codified as a human right.
Importing firms voluntarily adhere to fair trade standards or governments may enforce them through a combination of employment and commercial law. Proposed and practiced fair trade policies vary widely, ranging from the common prohibition of goods made using slave labour to minimum price support schemes such as those for coffee in the 1980s. Non-governmental organizations also play a role in promoting fair trade standards by serving as independent monitors of compliance with fair trade labeling requirements.
Typically all three types of laws must also be changed to implement any program of moral purchasing, fair trade, safe trade, or any tying of money supply to methods of measuring well-being. It is advocates of these measures that usually refer to tax, tariff, and trade policy as a single and indivisible anti-globalization movement, for instance, focuses on relationships between internal and external rules, and on the internal markets of a state, and what kinds of trade relations they create. They criticize inadequacy of existing rules, and argue that most of the so-called ‘trade’ rules are actually investment guarantees.
Critics of these movements and defenders of free trade and global investment liberalization respond that the older ideas of independent trade policy, investment policy and industrial policy assumed that a higher degree of control by governments over business was possible. Tariffs on marijuana were implied during the early 1900′s but were then removed by the marijuana tax stamp in 1938, making it illegal.
While factions disagree on the changes and the direction of change, all agree that the newer ideas about unified tax, tariff and trade laws take globalization for granted, and assume that not only nation states but larger trade blocs and smaller regions and cities are in competitive positions relative to other players worldwide:
Tax policy to encourage or discourage particular types of consumption or production in the jurisdiction.
Tariffs, or lack thereof, to encourage or discourage imports or consumption inside the jurisdiction.
Trade, especially investment, policy to encourage or discourage location of particular types of activity in the jurisdiction, especially leading to export opportunities.
Despite some exceptions, in a global economy, policy on all three issues reduces to quantitative distinctions, and impact of change must be considered on all fronts at once. To avoid a “race to the bottom” as competing jurisdictions try to undercut pricing, trade bloc rules and trade pacts become more necessary, e.g. North American Free Trade Agreement, and political integration for common rule-making more desirable, e.g. as in the European Union (EU).
Critics of this process, notably in the safe trade, fair trade, and anti-globalization movements, argue that this is itself a race to the bottom, in standards and regulations. Protections typically afforded by the state to its own citizens can no longer be economically afforded in an environment where the state itself is in a competitive position in a global market.
One solution is the development of simultaneous policy initiatives, which would require trading partners to implement similar political, e.g. labor rights, measures all at the same time, so none were disadvantaged economically relative to its trading partners for implementing a measure that all of the partners deemed desirable.
The EU, has a particularly strong form of integration of the three, fixing the targets of taxation, ending most internal tariffs, and building a common West European trade bloc. Recently they also developed a common currency, the Euro, and are planning to implement some fair trade rules based on means of measuring well-being. In the process, however, they have retained a system of agricultural subsidy which keeps the EU self-sufficient in food. Some call this hypocrisy, others call it evidence that a program of liberalization has limits, and that food and water supplies are inherently tied to local interests and ecologies. Thus some subsidies, and agricultural policy, are not part of the same negotiations as lead to tax, tariff and trade rule changes. Monetary integration is also considered a separate issue, and indeed the Euro was not implemented until long after acceptance of tax, tariff, trade rules.
The tax, tariff and trade laws of a political region, state or trade block determine which forms of consumption and production tend to be encouraged or discouraged. All three are often changed by a trade pact.
Typically all three types of laws must also be changed to implement any program of moral purchasing, fair trade, safe trade, or any tying of money supply to methods of measuring well-being. It is advocates of these measures that usually refer to tax, tariff, and trade policy as a single and indivisible anti-globalization movement, for instance, focuses on relationships between internal and external rules, and on the internal markets of a state, and what kinds of trade relations they create. They criticize inadequacy of existing rules, and argue that most of the so-called ‘trade’ rules are actually investment guarantees.
Critics of these movements and defenders of free trade and global investment liberalization respond that the older ideas of independent trade policy, investment policy and industrial policy assumed that a higher degree of control by governments over business was possible. Tariffs on marijuana were implied during the early 1900′s but were then removed by the marijuana tax stamp in 1938, making it illegal.
While factions disagree on the desirability of the changes and the direction of change, all agree that the newer ideas about unified tax, tariff and trade laws take globalization for granted, and assume that not only nation states but larger trade blocks and smaller regions and cities are in competitive positions relative to other players worldwide:
Tax policy to encourage or discourage particular types of consumption or production in the jurisdiction. Tariffs, or lack thereof, to encourage or discourage imports or consumption inside the jurisdiction. Trade, especially investment, policy to encourage or discourage location of particular types of activity in the jurisdiction, especially leading to export opportunities. Despite some exceptions, in a global economy, policy on all three issues reduces to quantitative distinctions, and impact of change must be considered on all fronts at once. To avoid a “race to the bottom” as competing jurisdictions try to undercut pricing, trade block rules and trade pacts become more necessary, e.g. North American Free Trade Agreement, and political integration for common rule-making more desirable, e.g. as in the European Union (EU).
Critics of this process, notably in the safe trade, fair trade, and anti-globalization movements, argue that this is itself a race to the bottom, in standards and regulations. Protections typically afforded by the state to its own citizens can no longer be economically afforded in an environment where the state itself is in a competitive position in a global market.
One solution is the development of simultaneous policy initiatives, which would require trading partners to implement similar political, e.g. labor rights, measures all at the same time, so none were disadvantaged economically relative to its trading partners for implementing a measure that all of the partners deemed desirable.
