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Examples, Differences
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A product is a tangible item that is put on the market for acquisition, attention,
or consumption, while a service is an intangible item, which arises from the
output of one or more individuals. Although it seems like the main distinction
between the two concepts is founded on their tangibility, that is not always the
case. In most cases services are intangible, but products are not always
tangible.
One thing to keep in mind is that products and services are closely aligned. In
fact, a majority of products carry with them an element of service. For
example, when a consumerTypes of CustomersCustomers play a significant
role in any business. By better understanding the different types of customers,
businesses can be better equipped to develop buys a car, the product comes
with a lot of other service responsibilities, such as tune-up and maintenance.
Nonetheless, there is a clear difference between the two concepts, and it’s
imperative for one to understand their working definitions.
Assessing the quality of a tangible product is very easy. Since most products
are countable, touchable, and visible, a consumer can assess its durability by
examining it. A good case in point is when an individual is buying a home. The
buyer will check every nook and cranny of the house, including the attic,
basement, foundation, each individual room, and more.
In contrast, a service is not something that one can feel or try out before paying
for it. Say an individual needs a professional inspector to identify any hidden
issues before deciding to purchase a home. Just how experienced is the
inspector with regard to plumbing, roofing, and other structural matters?
A potential car buyer usually checks the car’s body lines, feels the leather used
on the seats, and takes the car for a test drive before deciding whether to buy
the car or not. Since it’s a product, the buyer is aware of the specific production
line the vehicle hails from, and there are many more like it. In fact, there are
other cars identical to the one being bought.
But what about the service the car buyer receives from the car dealer? The way
a car salesperson interacts with one buyer is not the same way he interacts with
another buyer. If the car buyer is lucky, he may find a salesperson who is well-
informed, courteous, and is willing to negotiate. If he’s not, the car salesperson
might be one who lacks information or behaves in a nonchalant way.
Perishable services are such as airline flights, auto repair, theater entertainment,
and manicures. If an individual purchases an air ticket for a particular day, and
then he suffers a cold and is not able to travel, the ticket expires. The perishable
attribute of some services makes it hard to balance supply and demandSupply
and DemandThe laws of supply and demand are microeconomic concepts that
state that in efficient markets, the quantity supplied of a good and quantity
demanded of that good are equal to each other. The price of that good is also
determined by the point at which supply and demand are equal to each other..
Additional Resources
certification program for those looking to take their careers to the next level. To
keep learning and advancing your career, the following CFI resources will be
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