Commodity Flow

The flow of goods is the direction of movement of goods. Commodities are inherently liberal. This kind of “freedom” means that commodities will move wherever they are needed. The demand for commodities is actually a demand that has the ability to pay in money, that is, effective demand. Therefore, the end point of commodity flow is usually the consumption field where the demand is located, including the production and consumption field and the daily consumption field. The starting point of commodity flow, except for a very few remnants of daily life or waste materials, is the field of production. The journey of commodity flow from the starting point to the end point is the commodity circulation field. In the commodity circulation field, the flow rate, flow rate, scope, etc. of the commodity flow constitute the content of the commodity flow.

Commodity flow is the inevitable result of the inherent contradictory movement of commodity value and use value. Commodities are objects. “Commodities cannot go to the market by themselves or be exchanged by themselves.” When commodities flow from the production field to the consumption field, from the perspective of their physical form, they must undergo certain actual movements; from the perspective of their value form, they must undergo ownership changes. After a commodity is produced, it always belongs to a certain producer or organization. When it flows to final consumption, it always adopts a certain form of movement and goes through a series of transfer activities of commodity ownership. This transfer activity must be realized with the help of certain social forces, that is, it must choose a certain form of production and sales or purchase and sale methods to satisfy consumption and achieve reconciliation and release of the contradiction between commodity value and use value. In terms of the degree of development of the production and marketing forms that promote the flow of goods, there are three main forms of social forces: first, the integration of production and marketing, that is, producers sell goods directly to consumers without any intermediate links, and goods flow directly into the consumption field; second, It is the combination of production and marketing, that is, the producer sets up his own sales agency or personally participates in the sales of goods through agents, industrial and commercial consortiums, etc. The producer has two responsibilities, shouldering both the function of producing goods and the function of commercial sales; the third is the separation of production and marketing. That is, producers specialize in production, and goods pass through the specialized media of commercial institutions and are then traded and entered into the field of consumption.

The fundamental motivation that promotes the continuous translocation of commodity entities and the continuous change of values, thereby promoting the continuous movement of commodity value and use value, is to obtain as much output as possible with as little labor input as possible, so that The needs of society are met and the level and degree of this satisfaction are continuously improved. Under the conditions of modern developed commodity economy and developed commodity circulation, the integration of production and marketing occupies a very minor position. Although the combination of production and marketing, such as industrial self-sales, has developed, its proportion is relatively low. What really occupies the dominant position and plays a decisive role is The separation of production and marketing means that the social force that uses commerce as a medium to promote the flow of goods is the dominant force. The existence and development of business departmentalization and specialization depend on the business’s own contribution to society. On the one hand, social division of labor gives business the independent status of specific economic sectors to realize its basic function of developed commodity circulation; on the other hand, in order to complete the basic functions of business, society must give business corresponding remuneration to satisfy the legitimate interests of business. requirements, but this remuneration must be less than the cost of performing commercial functions before society is differentiated into commercial sectors.

Commodity circulation is the exchange of commodities as a whole, and commerce is the developed commodity circulation. It is an economic sector or industry that invests independently and specializes in commodity exchange. The business organization system and its interior mediate a large number of commodity exchanges at every moment. Through specific commercial enterprises and merchants, commerce, on the one hand, buys goods as representatives of consumers, and on the other hand, sells goods as representatives of producers, buying and selling at the same time, becoming an intermediary link between production and consumption. After commodities leave the production field and enter the commercial circulation field, commercial organizations or merchants will be consumer-centered and oriented to the consumption field, promoting the contradictory movement of commodity buying and selling from commercial institutions close to the production place to commercial institutions close to the consumption place. The general trend and direction of commodity flow have inherent objective inevitability.

First of all, affected by the profit mechanism, goods flow from areas with low profit rates to areas with high interest rates. The maximization of commercial economic benefits based on profits and profit margins is to govern business and promote the flow of goods. basic factors. The law of increase in commercial investment requires that commercial investment must increase. The basic formula for business operation is G-W-G’. The same amount of commercial capital obtains the same amount of profits, and the same amount of individual commercial capital pursues excess profits to maximize profits. Therefore, where the most profits can be extracted and where the possibility of profit is high, goods will flow there.

Secondly, affected by the price mechanism, goods flow from areas with low prices to areas with high prices. The difference between price region, season, wholesale and retail, and purchase and sale is the basic premise for the formation of commercial profits. After deducting the direct and indirect costs of commodity circulation, the greater the price difference of commodities, the greater the driving force of commerce and the faster the flow of commodities. Speeding up, the flow of goods carried also increases. In short, wherever the market demand is strong and prices are high, goods will be shipped and sold. The price difference of goods regulates the flow of goods.

Third, affected by the supply and demand mechanism, goods flow from production areas where supply exceeds demand to consumption areas where supply exceeds demand. The supply and demand mechanism is a reflection of the inherent relationship between commodity prices and commodity supply and demand. Commodity prices are the monetary expression of the value of commodities, but changes in commodity prices are driven by changes in commodity supply and demand. Under certain conditions of commodity value and currency value, if the supply of commodities exceeds demand, the price will fall; if the supply of commodities exceeds demand, the price will rise. Generally speaking, in the place of production, the supply of goods is large but the demand is limited. That is, if the supply of goods exceeds demand, sellers compete, and sellers compete, so the price of goods is relatively low; while in the place of consumption, the demand for goods is large but the supply is relatively low. Small, that is, if the supply of goods exceeds demand, buyers will compete, and if buyers compete, the price of goods will be relatively high. The price difference between the place of production and the place of consumption triggers the drive of commercial interests. As a result, commerce drives the flow of goods from the place of production where supply exceeds demand to the place of consumption where supply exceeds demand.

Fourth, affected by the risk mechanism, business entities stimulate innovation and risk-taking, comprehensively play the role of market mechanisms such as interest rates, prices, supply and demand, rationally allocate business resources, automatically adjust the supply and demand of goods, and reward and punish the best. to optimize the overall flow of social goods. Risk is a temptation of profit, which induces business entities to be willing to bear the risk of loss and bankruptcy and compete for profits.

In short, under the action of the law of value, through the form of competition, the interaction and mutual influence between commodity prices and commodity supply and demand are realized. The changes in the market supply and demand of commodities affect and restrict the changes in commodity prices. Changes in commodity prices in turn affect changes in commodity supply and demand. This change directly affects the profit income of commercial operators, thereby automatically adjusting the behavior of commercial operators, regulating the flow direction, flow, flow rate and structure of commodities, and ultimately promoting the flow of commodities from the production field to the consumption field, realizing the value and Use value to complete the consumption function of goods.

The operation of commodities is restricted by market mechanisms such as interest rates, prices, supply and demand, and risks. , showing regularity and orderliness in the direction of flow, forming a directionality that conforms to the natural laws of economics, that is, the basic direction and ability of the internal structure of the entire commodity circulation field determined by the direction of commodity flow. In the process of organizing commodity circulation, realizing its basic functions and playing a guiding role, commerce must consciously follow the directional and objective rules of commodity flow and make due contributions to the construction of socialist economy.

First of all, we should be market-oriented, establish the idea of ​​consumer sovereignty, and organize commodity circulation according to economic regions. The ultimate goal of commerce in organizing the circulation of goods and promoting the flow of goods is to meet the growing material and cultural needs of consumers. All business activities must be based on meeting the needs of consumers, establish the idea of ​​consumer sovereignty, and respect consumer choices. Protect the rights and interests of consumers. Under the conditions of the gradual formation of the buyer’s market in the socialist market economy, business should not only but also be able to realize the principle of consumer supremacy and transform from the ‘production-circulation-consumption’ thinking mode in the planned economy era to the ‘consumption-circulation-production’ thinking mode in the market economy era. “In terms of thinking mode. Get rid of the idea of ​​planned flow that relies on the government and plans, abandon the official-business style, establish the concepts of equal competition, doing business according to the law, and survival of the fittest, organize the circulation of commodities according to the economic regions formed by the natural flow of commodities, and rationally set up three-level wholesales of origin, transit place, and sales place. The market system eliminates unnecessary commodity circulation links and rationalizes commodity transportation.

Secondly, relying on large and medium-sized cities, we should give full play to the central role of large and medium-sized cities in commodity circulation. Cities are the product of socialized large-scale production and the development of commodity economy. Cities, especially large and medium-sized cities, are the economic centers of their surrounding areas, the country and even foreign markets, and play a special role in commodity circulation. On the one hand, the production bases of industrial products are mainly concentrated in large and medium-sized cities, and a large number of their products must be sold in all directions, with strong radiation power; on the other hand, large and medium-sized cities have dense populations and large purchasing power, which require a large amount of industrial products and agricultural and sideline products. It has strong cohesion; at the same time, large and medium-sized cities are also the diffusion centers of industrial products and the distribution centers of agricultural and sideline products, and have strong media power. “Business depends on the development of the city, and the development of the city also depends on commerce. This is self-evident.” Relying on large and medium-sized cities and giving full play to the central role of large and medium-sized cities in commodity circulation is an inevitable requirement for commerce based on the objective rules of commodity flow.

Thirdly, take rural market towns as the central location and give full play to the distribution role of market towns in commodity circulation. “Main markets for different products are formed in various central locations.” Rural market towns are connected to large and medium-sized cities on one end and the vast countryside on the other. They are the interface between cities and rural areas and are important centers for the circulation of industrial and agricultural products. Industrial products produced in large and medium-sized cities must spread to the vast rural areas through market towns, and agricultural and sideline products produced in rural areas must be concentrated through market towns and sold to large and medium-sized cities and other areas. In addition, rural market towns also have the function of collecting and distributing commodity economic information. In essence, they It is a rural economic center within a certain region. Therefore, vigorously carrying out commercial construction in rural market towns and giving full play to the role of rural market towns in commodity circulation are also objective requirements for the regularity of commodity flow.

Finally, actively expand purchases and sales and accelerate the reasonable flow of goods within the business system. Choosing reasonable commodity circulation channels and accelerating the buying and selling of commodities within the commercial system is another inherent requirement for commercial practice based on the objective rules of commodity flow.