Characteristics of services (Essay Sample)

CHARECTARISTICS OF SERVICES
Service is a type of economic activity that is intangible, is not stored and does not result in ownership.Some of the Characteristics of services are?
1 Perishability
Services are highly perishable compared to physical products. They cannot be stored, for instance ,if an airline does not sell all the seats on a particular flight, then those seats or rather the sales revenue of filling of them would have carried has immediately and irreversibly gone. Here the element of time assumes a significant position ,it cannot be stored.
2 Intangibility
Physical products can be widely displayed for customers to see, feel ,touch, weigh or sniff before deciding whether or not they want to buy it . On the other hand, one cannot see, feel, smell, weigh, touch or sniff services due to the intangible nature. This has given rise to special problems for both the supplier and consumer. Because services are intangible, while selling or promoting a service one has to concentrate on the satisfaction and benefit a consumer can derive having spent on the service.
3 Variability
The quality of services cannot be standardized. The provision of services invariably includes a large measure of the human element. Indeed with many services, we are purchasing nothing else but the skill of the supplier. Because of this it is often very difficult for both the supplier and consumer to ensure a consistent product or quality of the service. this is due to the difference in perception of individuals at the level of providers and users.
4 Inseparability
Services are generally created or supplied simultaneously. The service provision and provider are inseparable from the service consumption and provider. The service provider cannot be separated from the service itself. This has implications for both channels of distributions and scale of operations.e.g the entertainment industry, health experts and other professionals create and offer their services at the same given time.
5 Non-ownership
Services can be used or hired for a period of time. Unlike a physical product, the consumer does not secure ownership of the service. Rather the consumer pays only to secure access or use of the service. It is an activity that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Ownership is not affected in the process of selling the service.
6. Simultaneity
Services cannot be moved through channels of distribution and cannot be delivered to the potential customer or user. Thus, either users are brought to the services or providers go to the users. It is right to say that services have limited geographical area. When the producers approach the buyer time is taken away from the production of services and the cost of those services is increased. On the other hand it costs time and money for buyers to come to the producers directly. Here the economies of time and travel provide incentives to locate more service centre’s closer to prospective customer, resulting in the emergence of service centre’s e.g. an airplane cannot be brought to the customer.
1 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. E.g. we can quantify the quality of food served in a hotel but the way water serves the customer or behavior of the staff cannot be ignored while rating the total process. 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, e.t.c.
2 Nature of demand
Generally, the services are fluctuating in nature. e.g., during the peak tourist season there is an abnormal increase in the demand of services.
3 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 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.
CHALLENGES POSED BY CHARACTERISICS OF SERVICES
1 The marketer of the service cannot rely on the product-based clues that the buyer generally employs in alternative evaluation prior to purchases. So as a result the services are not known to the customers before they take them.
2 Services cannot be produced now and then consumed at a later date or time and this produces a new dimension to services.
3 The inability of the service sector to regulate supply with the changes in demand poses many quality management problems, hence service quality deteriorates during peak periods.
4 Managers face a problem in standardizing their services as it varies with experienced hand, customer, time and firm.
5 Inseparability of production and consumption involves the simultaneous in production and consumption which characterizes most services. Whereas goods are first produced ,then sold and then consumed, services are first sold and consumed simultaneously. Since the customer must be present during the production of many services, inseparability forces the buyer into intimate contact with the production process.
6 Heterogeneity concerns the potential for high variability in the performance of services. The quality and essence of all servi...