A merchant is a person who trades in goods produced by other people, especially one who trades with foreign countries. Merchants have been known for as long as humans have engaged in trade and commerce. Merchants and merchant networks operated in ancient Babylonia, Assyria, Ancient China, Ancient Egypt, Ancient Greece, Ancient India, Ancient Persia, Phoenicia and Roman Empire. During the European medieval period, a rapid expansion in trade and commerce led to the rise of a wealthy and powerful merchant class. The European Age of Discovery opened up new trading routes and gave European consumers access to a much broader range of goods. By the 18th century, a new type of manufacturer-merchant had started to emerge and modern business practices were becoming evident.
The status of the merchant has varied during different periods of history and among different societies. In modern times, the term merchant has occasionally been used to refer to a businessperson or someone undertaking activities (commercial or industrial) for the purpose of generating profit, cash flow, sales, and revenue using a combination of human, financial, intellectual and physical capital with a view to fueling economic development and growth.
However, the term 'merchant' is often used in a variety of specialised contexts such as in merchant banker, merchant navy or merchant services.
Trajan's Forum was a vast expanse, comprising multiple buildings with shops on four levels. The Roman forum was arguably the earliest example of a permanent retail shop-front.Coleman, P., Shopping Environments, Elsevier, Oxford, 2006, p. 28
In antiquity, commerce involved direct selling through permanent or semi-permanent retail premises such as stall-holders at market places or shop-keepers selling from their own premises or through door-to-door direct sales via merchants or . The nature of direct selling centred around transactional exchange, where the goods were on open display, allowing buyers to evaluate quality directly through visual inspection. Relationships between merchant and consumer were minimal
The social status of the merchant class varied across cultures; ranging from high status (the members even eventually achieving titles such as that of Merchant Prince or Nawab) to low status, as in China, Greece and Roman cultures, owing to the presumed distastefulness of profiting from "mere" trade rather than from labor or the labor of others as in agriculture and Artisan.Oka, R. and Kusimba, C.M., "The Archaeology of Trading Systems, Part 1: Towards a New Trade Synthesis," The Archaeology of Trading Systems, Part 1: Towards a New Trade Synthesis," Journal of Archaeological Research, Vol. 16, p. 359 The Romans defined merchants or traders in a very narrow sense. Merchants were those who bought and sold goods, while landowners who sold their own produce were not classed as merchants. Being a landowner was a "respectable" occupation. On the other hand, the Romans did not consider the activities of merchants "respectable".Tchernia, A., The Romans and Trade, Oxford, Oxford University Press, 2016, Ch 1 In the ancient cities of the Middle East, where the bazaar was the city's focal point and heartbeat, merchants who worked in bazaar enjoyed high social status and formed part of local elites.Ashraf, A., "Bazaar-Mosque Alliance: The Social Basis of Revolts and Revolutions," International Journal of Politics, Culture, and Society, Vol. 1, No. 4, 1988, pp. 538–567, Stable URL: , p. 539 In Medieval Western Europe, the Christian church, which closely associated merchants' activities with the sin of usury, criticised the merchant class, strongly influencing attitudes towards them.
In Greco-Roman society, merchants typically did not have high social status, though they may have enjoyed great wealth.Barnish, S.J.B. (1989) "The Transformation of Classical Cities and the Pirenne Debate", Journal of Roman Archaeology, Vol. 2, p. 390. Umbricius Scauras, for example, was a manufacturer and trader of garum in Pompeii, circa 35 C.E. His villa, situated in one of the wealthier districts of Pompeii, was very large and ornately decorated in a show of substantial personal wealth. Mosaic patterns in the floor of his atrium were decorated with images of bearing his personal brand and inscribed with quality claims. One of the inscriptions on the mosaic amphora reads "G(ari) F(los) SCOm/ SCAURI/ EX OFFIci/NA SCAU/RI" which translates as "The flower of garum, made of the mackerel, a product of Scaurus, from the shop of Scaurus". Scaurus' fish sauce had a reputation for very high quality across the Mediterranean; its fame travelled as far away as modern southern France.Curtis, R.I., "A Personalized Floor Mosaic from Pompeii", American Journal of Archaeology, Vol. 88, No. 4 (October 1984), DOI: 10.2307/504744, pp. 557–566, Stable URL: Other notable Roman merchants included Marcus Julius Alexander (16 – 44 CE), Sergius Orata (fl. c. 95 BCE) and Annius Plocamus (1st century CE).
In the Roman world, local merchants served the needs of the wealthier landowners. While the local peasantry, who were generally poor, relied on open-air market places to buy and sell produce and wares, major producers such as the great estates were sufficiently attractive for merchants to call directly at their farm-gates. The very wealthy landowners managed their own distribution, which may have involved exporting.Bintliff, J., "Going to Market in Antiquity," In Stuttgarter Kolloquium zur Historischen Geographie des Altertums,
: "The kind of model that Morley and other specialists in Greco-Roman marketing have been developing ... sees the local market-town as primarily serving local peasantry. Here they unload their small surplus and purchase minor amounts of farm equipment and luxuries for their barns and homes; some of their needs are already met through travelling pedlars and non-urban periodic fairs held at long intervals. Major producers – the great estates – would be attractive enough foci for merchants to consider travelling directly to purchase commercially-focussed harvests 'at the farm gate', and some landowners were wealthy enough to handle their own distribution to urban markets in the country of production and even to other countries. These latter processes are documented both in the ancient sources and archaeological case-studies." Markets were also important centres of social life, and merchants helped to spread news and gossip.Millar, F., "The World of the Golden Ass", Journal of Roman Studies, Vol. 71, 1981, pp. 63–67
The nature of export markets in antiquity is well documented in ancient sources and in archaeological case-studies. Both Greek and Roman merchants engaged in long-distance trade. A Chinese text records that a Roman merchant named Lun reached southern China in 226 CE. Archaeologists have recovered Roman objects dating from the period 27 BCE to 37 CE from excavation sites as far afield as the Kushan Empire and Indus River ports. The Romans sold purple and yellow dyes, brass and iron; they acquired incense, balsam, expensive liquid myrrh and spices from the Near East and India, fine silk from ChinaMcLaughlin, R., The Roman Empire and the Silk Routes: The Ancient World Economy and the Empires of Parthia, Central Asia and Han China,South Yorkshire, Pen and Sword Books, 2016 and fine white marble destined for the Roman wholesale market from Arabia. McLaughlin, R., The Roman Empire and the Indian Ocean: The Ancient World Economy and the Kingdoms of Africa, Arabia and India, South Yorkshire, Pen and Sword Books, 2014, p. 135: "The pure-white marble that was quarried in southern Arabia had a fine crystalline texture and Roman merchnts took aboard this heavy material as ballast to stabilise their ships. On their return to the empire, this valuable marble was sold to stoneworkers and carved into elegant unguent jars that resembled radiant alabaster." For Roman consumers, the purchase of goods from the East was a symbol of social prestige. McLaughlin, R., The Roman Empire and the Indian Ocean: The Ancient World Economy and the Kingdoms of Africa, Arabia and India, South Yorkshire, Pen and Sword Books, 2014, p. 222: "A further Roman criticism of eastern trade was that it created a consumer market for expensive foreign goods that were wastefully extravagant and ultimately unnecessary. ... During the Julio-Claudian era aristocratic families competed for political status and prestige through the ostentatious display of wealth."
Merchant began to form during the medieval period. A fraternity formed by the merchants of Tiel in Gelderland (in present-day Netherlands) in 1020 is believed to be the first example of a merchant guild. The term, guild was first used for gilda mercatoria and referred to body of merchants operating out of St. Omer, France in the 11th century. Similarly, London's Hanseatic League was formed in the 12th century. These guilds controlled the way that trade was to be conducted and codified rules governing the conditions of trade. Rules established by merchant guilds were often incorporated into the charters granted to . In the early 12th century, a confederation of merchant guilds, formed out the German cities of Lübeck and Hamburg, known as "The Hanseatic League" came to dominate trade around the Baltic Sea. By the 13th and 14th centuries, merchant guilds had sufficient resources to have erected guildhall in many major market towns.Epstein, S.A, Wage Labor and Guilds in Medieval Europe, University of North Carolina Press, 1991, pp 50–100
During the thirteenth century, European businesses became more permanent and were able to maintain sedentary merchants and a system of agents. Merchants specialised in financing, organisation and transport while agents were domiciled overseas and acted on behalf of a principal. These arrangements first appeared on the route from Italy to the Levant, but by the end of the thirteenth century merchant colonies could be found from Paris, London, Bruges, Seville, Barcelona and Montpellier. Over time these partnerships became more commonplace and led to the development of large trading companies. These developments also triggered innovations such as double-entry book-keeping, commercial accountancy, international banking including access to lines of credit, marine insurance and commercial courier services. These developments are sometimes known as the commercial revolution.Casson, M. and Lee, J., "The Origin and Development of Markets: A Business History Perspective," Business History Review, Vol 85, Spring, 2011, doi:10.1017/S0007680511000018, pp 22–26
Luca Clerici has made a detailed study of Vicenza's food market during the sixteenth century. He found that there were many different types of merchants operating out of the markets. For example, in the dairy trade, cheese and butter was sold by the members of two craft guilds (i.e., cheesemongers who were shopkeepers) and that of the so-called ‘resellers’ (hucksters selling a wide range of foodstuffs), and by other sellers who were not enrolled in any guild. Cheesemongers’ shops were situated at the town hall and were very lucrative. Resellers and direct sellers increased the number of sellers, thus increasing competition, to the benefit of consumers. Direct sellers, who brought produce from the surrounding countryside, sold their wares through the central market place and priced their goods at considerably lower rates than cheesemongers.Clerici, L., "Le prix du bien commun. Taxation des prix et approvisionnement urbain (Vicence, XVIe-XVIIe siècle)" The in I prezzi delle cose nell’età preindustriale / The Prices of Things in Pre-Industrial Times, forthcoming, Firenze University Press, 2017. From 1300 through to the 1800s a large number of European chartered and merchant companies were established to exploit international trading opportunities. The Company of Merchant Adventurers of London, chartered in 1407, controlled most of the fine cloth imports "Merchant Adventurers" in Encyclopædia Britannica, Online Library Edition, 2013. Retrieved 22 July 2013. while the Hanseatic League controlled most of the trade in the Baltic Sea. A detailed study of European trade between the thirteenth and fifteenth century demonstrates that the European age of discovery acted as a major driver of change. In 1600, goods travelled relatively short distances: grain 5–10 miles; cattle 40–70 miles; wool and wollen cloth 20–40 miles. However, in the years following the opening up of Asia and the discovery of the New World, goods were imported from very long distances: calico cloth from India, porcelain, silk and tea from China, spices from India and South-East Asia and tobacco, sugar, rum and coffee from the New World.Braudel, F. and Reynold, S., The Wheels of Commerce: Civilization and Capitalism, 15th to 18th Century, Berkeley CA, University of California Press, 1992
In Mesoamerica, a tiered system of traders developed independently. The local markets, where people purchased their daily needs were known as tianguis while pochteca referred to long-distance, professional merchants traders who obtained rare goods and luxury items desired by the nobility. This trading system supported various levels of pochteca – from very high status merchants through to minor traders who acted as a type of peddler to fill in gaps in the distribution system.Salomón, F., "Pochteca and mindalá: a comparison of long-distance traders in Ecuador and Mesoamerica," Journal of the Steward Anthropological Society, Vol. 1–2, 1978, pp 231–246 The Spanish conquerors commented on the impressive nature of the local and regional markets in the 15th century. The Mexica (Aztec) market of Tlatelolco was the largest in all the Americas and said to be superior to those in Europe.
In much of Renaissance Europe and even after, merchant trade remained seen as a lowly profession and it was often subject to legal discrimination or restrictions, although in a few areas its status began to improve.
As Britain continued colonialism, large commercial organisations came to provide a market for more sophisticated information about trading conditions in foreign lands. Daniel Defoe ( 1660–1731), a London merchant, published information on trade and economic resources of England, Scotland and India.Minto, W., Daniel Defoe, Tredition Classics, Project, Chapter 10Richetti, J., The Life of Daniel Defoe: A Critical Biography, Malden, MA., Blackwell, 2005, 2015, pp 147–49 and 158-59 Defoe was a prolific pamphleteer. His many publications include titles devoted to trade, including: Trade of Britain Stated (1707); Trade of Scotland with France (1713); The Trade to India Critically and Calmly Considered (1720) and A Plan of the English Commerce (1731); all pamphlets that became highly popular with contemporary merchants and business houses.Backscheider, P.R., Daniel Defoe: His Life, Baltimore, Maryland, Johns Hopkins University Press, 1989.
Armenians operated as a prominent trade nation during the 17th century. They stood out in international trade due to their vast network – mostly built by Armenian migrants spread across Eurasia. Armenians had established prominent trade-relations with all big export players such as India, China, Persia, the Ottoman Empire, England, Venice, the Levant, etc. Soon they captured Eastern and Western Europe, Russia, the Levant, the Middle East, Central Asia, India, and the Far East trade routes, carrying out mostly caravan-trade activities. A significant reason for Armenians' massive involvement in international trade was their geographic location – the Armenian lands stand at the crossroads between Asia and Europe. Another reason was their religion, as they were a Christian nation isolated between Muslim Iran and Muslim Turkey. European Christians preferred to carry out trade with Christians in the region. abstract of book chapter
Eighteenth-century merchants who traded in foreign markets developed a network of relationships which crossed national boundaries, religious affiliations, family ties, and gender. The historian, Vannneste, has argued that a new "Cosmopolitanism merchant mentality" based on trust, reciprocity and a culture of communal support developed and helped to unify the early modern world. Given that these cosmopolitan merchants were embedded within their societies and participated in the highest level of exchange, they transferred a more outward-looking mindset and system of values to their commercial-exchange transactions, and also helped to disseminate a more global awareness to broader society and therefore acted as agents of change for local society. Successful, open-minded cosmopolitan merchants began to acquire a more esteemed social position within the political elites. They were often sought as advisors for high-level political agents.Vanneste, R., Global Trade and Commercial Networks: Eighteenth-Century Diamond Merchants, London, Pickering and Chatto, 2011, The English belong to this era.
By the eighteenth century, a new type of manufacturer-merchant was emerging and modern business practices were becoming evident. Many merchants held showcases of goods in their private homes for the benefit of wealthier clients.McKendrick, N., Brewer, J. and Plumb . J.H., The Birth of a Consumer Society: The Commercialization of Eighteenth Century England, London, 1982. Samuel Pepys, for example, writing in 1660, describes being invited to the home of a retailer to view a wooden jack.Cox, N.C. and Dannehl, K., Perceptions of Retailing in Early Modern England, Aldershot, Hampshire, Ashgate, 2007, pp 155–59 McKendrick, Brewer and Plumb found extensive evidence of eighteenth-century English entrepreneurs and merchants using "modern" marketing techniques, including product differentiation, sales promotion and loss-leader pricing.McKendrick, N., Brewer, J. and Plumb . J.H., The Birth of a Consumer Society: The Commercialization of Eighteenth Century England, London, 1982. English industrialists, Josiah Wedgewood (1730–1795) and Matthew Boulton (1728–1809), are often portrayed as pioneers of modern mass-marketing methods.Tadajewski, M. and Jones, D.G.B., "Historical research in marketing theory and practice: a review essay", Journal of Marketing Management, Vol. 30, No. 11-12, 2014 Special, pp 1239–1291. Wedgewood was known to have used marketing techniques such as direct mail, travelling salesmen and catalogues in the eighteenth century. Wedgewood also carried out serious investigations into the fixed and variable costs of production and recognised that increased production would lead to lower unit-costs. He also inferred that selling at lower prices would lead to higher demand and recognised the value of achieving scale economies in production. By cutting costs and lowering prices, Wedgewood was able to generate higher overall profits.Drake, D., "Dinnerware & Cost Accounting? The Story of Josiah Wedgwood: Potter and Cost Accountant," HQ Financial Views, Volume I, 1 May–July 2005, pp 1–3 Similarly, one of Wedgewood's contemporaries, Matthew Boulton, pioneered early mass-production techniques and product differentiation at his Soho Manufactory in the 1760s. He also practiced planned obsolescence and understood the importance of "celebrity marketing" – that is supplying the nobility, often at prices below cost – and of obtaining patronage, for the sake of the publicity and kudos generated.Applbaum, K., The Marketing Era: From Professional Practice to Global Provisioning, Routledge, 2004, p. 126-127 Both Wedgewood and Boulton staged expansive showcases of their wares in their private residences or in rented halls.McKendrick, N., Brewer, J. and Plumb . J.H., The Birth of a Consumer Society: The Commercialization of Eighteenth Century England, London, 1982. Eighteenth-century American merchants, who had been operating as importers and exporters, began to specialise in either wholesale or retail roles. They tended not to specialise in particular types of merchandise, often trading as general merchants, selling a diverse range of product types. These merchants were concentrated in the larger cities. They often provided high levels of credit financing for retail transactions.Savitt, R., "Looking Back to See Ahead: Writing the History of American Retailing", in Retailing: The Evolution and Development of Retailing, A. M. Findlay, Leigh Sparks (eds), pp 138–39.
A system of credit was especially important because there was a shortage of cash in Britain and America following the Revolutionary War. Because the state of both countries was so tumultuous after the war, an honor system was essential to establish social bonds. Without a system to keep people accountable, professional relationships are destroyed, innocent people are left to pay the debts of the perpetrators, and entire trade networks are left financially ruined.
Historian Jon Stobart explained in an article that the way merchants often entered these networks was via apprenticeships, and the personal connections made during these relationships “reinforced the status of the merchants.” Stobart further elaborates that these bonds between masters and apprentices allowed merchants to be known to other people, and more importantly, to be trusted by others. However, the way this social hierarchy was initially introduced allowed it to become rife with exploitation.
This is explained in many anecdotes like the story of Daniel Parker, a merchant from Watertown, Massachusetts, who was part of a major commercial network. He was able to escape his debts merely by escaping on a ship to Europe. leaving his friends and family to clean up his mess. If too many people were to exploit these loopholes, it would cause the entire system to collapse. Parker was said to "maintain his innocence" despite all the charges of fraud because of his change in environment. In Europe, he had a neutral reputation and therefore was able to conduct his business without negative consequences.
The main reason that Parker was able to escape consequences was the idea of “social credit” and social bonds between merchants. Once he arrived in Britain, no one knew of his history of evading his debts, so people had no reason to distrust him about his financial endeavors. In essence, his social reputation worked similarly to a modern-day credit score. If one has a “good score”, it’s much easier for that person to do business with others and eventually scam more innocent customers and fellow merchants out of their money. But by keeping people accountable by better communicating between economies, people are able to keep shady merchants such as Parker from playing the system. But because he was able to escape, he was able to manipulate more people. Cutterham explains further in his article that while in London and Amsterdam, Parker “became a substantial participant in an emerging international financial market.” He was able to make powerful connections within this new environment, with one of the most influential people he met being the ambassador to the Netherlands from the United States, John Adams. Adams served in this capacity between the years of 1778 and 1788, but of course would become even more notable as the second President of the United States, starting in 1797.
The fact that Parker was able to acquaint himself with such powerful and intelligent people goes to show that major reforms needed to be made in the system if prosperity was to be achieved. Network formations during this period were essential to the bonds between merchants. Family businesses within communities were common, but it was fundamentally clear that wider geographical networks were required to sustain larger flows of income.
In the nineteenth century, merchants and merchant houses played a role in opening up China and the Pacific to Anglo-American trade interests. Note for example Jardine Matheson & Co. and the merchants of New South Wales. Other merchants profited from natural resources (the Hudson's Bay Company theoretically controlled much of North America, names like Rockefeller and Branobel dominated trade in oil in the US and in the Russian Empire), while still others made fortunes from exploiting new inventions – selling space on and commodities carried by railways and steamships.
In fully planned economy of the 20th century, planners replaced merchants in organising the distribution of goods and services.
However, merchants, increasingly labelled with euphemisms such as "industrialists", "businessmen", "entrepreneurs" or "oligarchs", Graph of proportionate terminology usage continue their activities in the 21st century.
In 2022, Dutch photographer Loes Heerink spend hours on bridges in Hanoi to take pictures of Vietnamese street Merchants. She published a book called Merchants in Motion: the art of Vietnamese Street Vendors.
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