File Name: difference between goods and services .zip
Explain its basic characteristics. A service is an act or performance offered by one party to another. They are economic activities that create value and provide benefits for customers at specific times and places as a result of bringing desired change.
Characteristics of services Service is an act or performance offered by one party to another. They are economic activities that create value and provide benefits for customers at specific times and places as a result of bringing about a desired change in or on behalf of the recipient of the service. The term service is not limited to personal services like medical services, beauty parlors, legal services, etc.
According to the marketing experts and management thinkers the concept of services is a wider one. The term services are defined in a number of ways but not a single one is universally accepted. The distinct characteristics of services are mentioned below. Intangibility: Services are intangible we cannot touch them are not physical objects.
According to Carman and Uhl, a consumer feels that he has the right and opportunity to see, touch, hear, smell or taste the goods before they buy them. This is not applicable to services. The buyer does not have any opportunity to touch smell, and taste the services.
While selling or promoting a service one has to concentrate on the satisfaction and benefit a consumer can derive having spent on these services. For e. An airline sells a flight ticket from A destination to B destination. Perishability : Services too, are perishable like labor, Service has a high degree of perish ability. Here the element of time assumes a significant position.
If we do not use it today, it labor if ever. If labor stops working, it is a complete waste. It cannot be stored. Utilized or unutilized services are an economic waste. An unoccupied building, an unemployed person, credit unutilized, etc.
Services have a high level of perish ability. Inseparability: Services are generally created or supplied simultaneously. They are inseparable. For an e. Services and their providers are associated closely and thus, not separable.
Therefore inseparability is an important characteristic of services which proves challenging to service management industry. Heterogeneity: This character of services makes it difficult to set a standard for any service. The quality of services cannot be standardized. The price paid for a service may either be too high or too low as is seen in the case of the entertainment industry and sports. The same type of services cannot be sold to all the consumers even if they pay the same price.
Consumers rate these services in different ways. This is due to the difference in perception of individuals at the level of providers and users. Heterogeneity makes it difficult to establish standards for the output of service firm. Ownership: In the sale of goods, after the completion of process, the goods are transferred in the name of the buyer and he becomes the owner of the goods. But in the case of services, we do not find this. The users have only an access to services.
They cannot own the service. Simultaneity: Services cannot move through channels of distribution and cannot be delivered to the potential customers and user. Thus, either users are brought to the services or providers go to the user. It is right to say that services have limited geographical area.
On the other hand it cost time and money for the buyers to come to producers directly. Here the economics of time and travel provide incentives to locate more service centers closer, to prospective customer, resulting in emergence of smaller service centers for e. Quality Measurement: A service sector requires another tool for measurement.
We can measure it in terms of service level. It is very difficult to rate or quantify total purchase. Hence we can determine the level of satisfaction at which users are satisfied.
Thus the firm sells good atmosphere convenience of customers, consistent quality of services, etc. What is the nature of Service Marketing? Services, which are economic activities, are solutions to customer problems or needs. They are typically aimed at improving, upholding or sustaining the lifestyle of the customer. Also includes social efforts by the government to fight the evils present in the society. Certain characteristics distinguish goods from services.
Intangibility : The primary characteristic that distinguishes services from goods is intangibility. Services such as banking insurance and education cannot be physically possessed like a tangible goods.
Intangible services are more difficult for consumer to evaluate than tangible goods. For example it is more difficult to evaluate the services provided by a physician than to evaluate an automobile. Inseparability: Another characteristic of service is the inseparability or indivisible nature of production and consumption of services.
Services like education are generally produced and consumed at the same time. Due to this nature, the service provider plays a very important role in delivery of services. For example a dentist is the actual service provider and must be physically present along with the consumer when the service is produced and consumed. In many cases the service provider is the part of service. In fact, svices are marked by two kinds of inseparability: i Inseparability of production and consumption ii Inseparability of the services from the person who possesses the skill and performs the services.
Service is produced and consumed simultaneously. This is not so with physical products goods. Moreover consumer also plays an active role in the production and delivery of services.
Inconsistency : It refers to the variation in performance of services. People perform most services and people are not always consistent in their performance. Performance may vary from one individual or service to another within the same organization or in the service one individual provides from day to day and from customer to customer.
For example, an airline may not give the same quality of service on each trip; All repair jobs which a mechanic does may be consistent. Inventory-Less or Perishability : Perishability is the characteristic where the service capacity unused in one time period cannot be stored for use in the future. Services are highly perishable. They cannot be stored, there are no inventories in the case of a service.
For example, in an airline industry the morning flight cannot be stored for the evening. Cannot be Produced in Anticipation of Demand : Goods can be produced in anticipation of demand. For instance, cars, computers, CDs, etc. However, services cannot be produced in anticipation of demand.
For instance, one cannot produce and stock hairstyles, airline travelling, etc. Because of this reason, consumer of services do prefer to take services of highly skilled specialists, may be even quite a distance away. Time Utility is Crucial : In services, time factor is crucial. A tangible item such as car can be stocked for several days or even months before it is sold to the buyer.
However, in the case of services, a service provider who sits idle waiting for customers to turn loses that time forever. This is why some service providers like doctors insist on prior appointments by their clients.
No Ownership Transfer : Services may not result in transfer of ownership rights from the service provider to the customer. However, in case of marketing of goods, the ownership transfer takes place once the sale contract takes place. Direct Channel : Generally, services are provided directly to the customers.
Everyone of us purchase many products for our personal and commercial purposes everyday, some of them are tangible and some are intangible. Based on this tangibility, products are differentaited as Goods and Services. Goods are tangible in nature and Services are intangible and inseperable in nature. This article mainly aims at communicating the differences between Goods and Services. Goods are the things that can be offered to a market for attention, acquisition, use or consumption that might satisfy a want or need of a customer. Goods are tangible in nature, they can touched, smelled at, gripped, etc before purchasing.
Meaning Goods are the material items Services are amenities, that can be seen, touched or felt facilities, benefits or and are ready for sale to the help provided by other customers. Nature Tangible Intangible. Transfer of Yes No ownership.
They are the most basic products of an economy. Are those goods or services? The answer is, they are both.
Product vs Service. People require different services and products to satisfy various needs and wants. In this regard, it can be observed that the marketers play a pivotal role in marketing different products and services to various targeted customers. However, some people often confuse the two terms and often use them interchangeably to refer to one thing but a closer analysis between them shows that they are different.
What are the differences between goods and services? A fundamental question when it comes to online shopping, but one with a simple answer. Goods are consumable products with physical characteristics shape, size, weight, etc. When a consumers buys goods from a retailer, the ownership of said goods is transferred to them, and the goods can also be returned for a refund or credit if they are deficient. There may also be a delay between the purchase of goods and the customer receiving said goods, whereas there should be no delay between purchase and consumption of a service.
Simultaneous production and consumption Production separated from consumption Perishable Non-perishable Goods are tangible while services are intangible The quality of goods, once produced, does not vary. However, the quality of services is dependent upon service provider and may vary greatly You own goods but you utilize services Goods are transferable such property and electronic goods and jewelry while services are not Services have impact on sale of goods but goods cannot affect sale of services. Since, services are not tangibles, they do not have features that appeal to the customer senses, their evaluation, unlike goods, is not possible before actual purchase and consumption. The service provider can emphasize on the benefits of the service rather than just describing the features. Not all the service product has similar intangibility. Some services are highly intangible, while the others are low i. For example: Teaching, Consulting, Legal advices are services which have almost nil tangible components; While restaurants, fast food centers, hotels and hospitals offer services in which their services are combined with product tangible objective , such as food in restaurants, or medicines in hospitals etc.
In economics, goods and services are often pronounced in the same breath. These are offered by the companies to the customers to provide utility and satisfy their wants. At present, the success of the business lies in the combination of best quality of goods and customer oriented services. Goods implies the tangible commodity or product, which can be delivered to the customer. It involves the transfer of ownership and possession from seller to the buyer. On the other hand, services alludes to the intangible activities which are separately identifiable and provides satisfaction of wants.
PDF | This paper conducts an exploration of services innovation specificities with respect to innovation in goods. It focuses primarily on.Reply