Buying, selling, and trading goods have always been the economy's foundation. After the fall of the Roman Empire, Merchants were a small but essential part of the feudal social structure. Over time, they gained status and wealth while contributing to the development of modern business practices. Keep reading to learn about how this transition progressed.
Fig. 1: The Vinegar Merchant.
Merchant Definition:
Below is the definition of a merchant.
Merchant:
A person who buys goods produced by other people. Merchants sell the goods for profit.
Difference between Trader and Merchant
A trader is a person who makes a living by purchasing goods and selling them for a profit. A merchant works in retail or owns a retail business that sells goods.
What did merchants do? They facilitated bargaining and trading, helping to create more stable markets. They also helped to make an exchange network, which not only supported the movement of goods but also the movement of ideas.
The actions of merchants had long-term effects. They developed business practices still used today, including double-entry bookkeeping, insurance, extending credit, and charging interest on loans.
Merchants History
Merchants have been a part of the economy for as long as people have wanted to trade different types of commodities.
After the Roman Empire fell, European people lived under the system of feudalism. Most of these people were peasants who worked the land of the nobility. While merchants were more potent than peasants, their social class was small.
Feudalism
A structured social system where people pledged loyalty to the social class above them. They would work for them, and in return, they could expect land and protection.
The Crusades in the 11th century opened up new trade routes while at the same time creating a greater need for merchants. Merchants suddenly found themselves responsible for helping European crusaders obtain food and other supplies for their armies. Merchants acted as middlemen, going back and forth between the troops and suppliers. As you may expect, the increased need for merchants led to more.
Crusade
a Christian military expedition that had the goal of retaking land from Muslims
Merchants were able to travel to new lands and access new varieties of goods like spices, textiles, and other raw materials.
The Middle Ages found trade exploding in popularity as merchants gained wealth and social standing. Market towns became popular in the 12th century. Traders would take local goods to market towns.
As access spread to exotic lands, medieval merchants began to sell goods from faraway places. Market towns started growing at an even faster pace. Merchant guilds began to grow as well.
Merchants continued to evolve into the 13th century. They became more stable and less nomadic. In addition to buying and selling goods, merchants began financing and transporting goods.
The 13th and 14th centuries brought increased retail activity and the decline of feudalism. This propelled the merchant class to a higher social standing. Medieval fairs became a popular way to sell goods.
Two classes of merchants emerged in 16th-century Europe. One group was the local merchants, and the other was merchants who worked with people outside the area, juggling sales in addition to importing/exporting goods, credit, and finance.
Fig. 2: Marco Polo.
Merchant Guilds
Merchant guilds began as groups of traders gathered to deal with problems related to power struggles with lords and landlords, theft, networks, and resources. The first guilds were formed in Europe during the 11th century.
Merchant guilds provided protection and resources to their members, especially during feudal times. Establishing guilds led to protection from unfair tax policies. Guilds also protected merchants and traders as they traveled from town to town.
Guild leaders became powerful, and guilds became more exclusive, leading to the creation of craft guilds.
Fig. 3: Shield of the Butchers' Guild.
Merchant Trade
Merchants in the Middle Ages used both sea and land to trade. The Silk Road and Medieval Fairs are a couple of examples.
Venetian and Genoese merchants traded on land and water.
Medieval Fairs
Medieval Fairs were one-way merchants sold goods. A Medieval Fair was a sociocultural gathering and economic marketplace, often occurring at the same time as major religious holidays. Once acting as a forum for religious celebrations, these events transitioned into marketplaces. Vendors would come from all over to sell goods like wine, spices, meat, and animals.
In the 12th and 13th centuries, medieval fairs were the primary way merchants could buy and sell goods.
Medieval Fair
A Medieval Fair was a sociocultural gathering and economic marketplace, often occurring at the same time as major religious holidays.
Silk Road
The Silk Road was an important trade network during the Middle Ages. It connected Europe and parts of Asia. Merchants used the Silk Road between 130 BCE and 1453 CE.
Merchants used the Silk Road to import and export various goods. Some examples include silk, jewelry, porcelain, and spices.
Did you know? The Silk Road also allowed for the movement of ideas, such as Buddhism.
Silk Road
An ancient trade route that allowed for the transfer of goods and ideas
Fig. 4: The Silk Road Route.
Genoese Merchants
Merchants in Genoa, Italy, made a name for themselves. They bought and sold goods in many places, including the Byzantine Empire, Egypt, and modern-day Libya. Genoese Merchants participated in the Mediterranean Slave Trade in the 12th and 13th centuries.
Did you know? Genoese merchants were the merchants of choice for the Byzantine Empire.
Venetian Merchants
Venetian merchants became esteemed maritime traders due to Venice's location in the Mediterranean. Not only did these merchants trade with other European cities and trade with the Middle East and North Africa, and traveled the Silk Road to China.
Marco Polo
Marco Polo was born in 1254 in Venice, Italy. He became a famed traveler, author, and explorer traveling from Europe to Asia.
Marco Polo was born to a family of merchants, with his father and uncle being influential members of the Venetian merchant community. His family had spent a good deal of time traveling and trading in the Middle East, rewarding them with wealth and prestige.
Marco Polo traveled with his father and uncle to the Mongol court in his late teens. As part of their travels, Marco Polo and his family went through modern-day eastern Turkey and northern Iran. They continued through the land route, bound for the Mongol Court. They found themselves detained in several places along the way. Some of these stops lasted for up to a year!
Marco Polo and their family traveled the central part of the Silk Road, meeting people of varying religions and faiths. They reached the Mongol Court sometime between 1274 and 1275. The Polos spent nearly 20 years living in China. They later journeyed back to Venice, but historians are unsure of the exact date. It's thought that they began their return home between 1290 and 1292. They reached Venice in 1295.
Fig. 5: A Mosaic of Marco Polo.
Merchants Summary
A merchant buys and sells goods other people produce, usually in a retail business. A trader makes a living by purchasing goods and reselling them to others.
After the fall of the Roman Empire, the system of feudalism evolved. The merchants were a small class of people with moderate power in this system. However, the Crusades gave the merchants access to new trade routes to obtain more goods. They also acted as middlemen, helping to supply armies with goods.
The merchant class exploded in popularity and power in the Middle Ages. Market towns began to grow; Merchants unitized the Silk Road and Medieval Fairs to sell goods and reach new consumers. Guilds were formed to protect the merchant and his customers. Merchants continued to evolve with the decline of feudalism.
Merchants played a significant role in bargaining and trading, creating stable markets in their communities. They also made exchange networks that allowed people to exchange ideas, beliefs, and other cultural aspects besides goods. Merchants contributed to the spread of math, explicitly accounting. They developed modern business practices. These include double-entry bookkeeping, using insurance, extending credit, and charging interest on loans.
Merchants - Key takeaways
- A merchant buys and sells goods other people produce, usually in a retail business.
- Merchants created stable markets in their communities due to their significant role in bargaining and trading. Their activities led to the development of exchange networks that allowed people to exchange ideas, beliefs, and other cultural aspects in addition to goods.
- Merchants contributed to the spread of math, explicitly accounting. They developed modern business practices.
- Merchants have always been a part of the local economy; however, the Crusades allowed them to access new goods and gain more importance. Merchants supplied the armies as well. This led to an increased need for more merchants. As the social class expanded, merchants gained wealth and social standing.
- Market towns and medieval fairs allowed tor merchants to reach a more extensive consumer base and become more stable.
- By the end of the 16th century, there were two classes of merchants. One was local merchants, and the other was those who traveled, imported/exported goods, and offered credit and financing.
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