Service Definition

A service is something that the government or an official body plans and organizes to meet public demand, such as transportation, communications, healthcare, or energy supply. Services, as opposed to products, are non-physical, intangible components of our economy.

Most wealthy countries' economies are based on services, including banking, education, health care, and transportation. They also represent the majority of the economy of developing countries.

Characteristics of Service

• It cannot be stored - No ownership changes when a company provides a service and a customer pays for it. A service cannot be moved or stored anywhere. They are only present for as long as the customer uses them and the provider supplies them. For instance, a haircut is a service that can't be shipped or stored. In reality, the haircut only lasts as long as someone is trimming your hair.
• It can't be touched - When you pay for a service, you receive an intangible benefit. In other words, you don't get anything substantial. As a result, you cannot touch it. The client receives the services they have requested from the service provider. As a result of the transaction, the customer has no ownership interest in any physical, immovable, or fixed property.

The willingness of the customer to pay for a product or service is a good indicator of its value or advantages. Service providers make money from the skills, ideas, resources, and expertise they deliver.

Examples of intangible services are- expertise, consultancy, insurance, accounting, etc.

Goods V/s Service

Every economy on the planet comprises a combination of products and services.

Goods

The tangible, material objects we generate are called goods. We can manage or interact with them. Finally, they are purchased, sold, & consumed. Products can be moved around and kept in storage. Your house likely has several examples of commodities, including your dishwasher, washer, dryer, microwave, and stove. Other products include water taps, furnishings, laptops, cell phones, and televisions. Anything we produce through mining, agriculture, or manufacturing benefits you somehow.

Service

These jobs are carried out on your behalf by other people, organizations, or governmental agencies.

Booking agents provide services when you utilize their services to book a hotel room, a flight, or a vacation. You can't touch or handle that reservation; it's an ethereal, intangible concept. It is not possible to store or transport such reservations.

Every government function exists to help the people. The police, the military, the fire department, ambulances, and paramedics are a few examples. Most developed economies also include healthcare, public broadcasting, & waste management as services.

The Five Pillars of Services

Listed below are the 5 "I's":

1. Intangibility- You cannot hold or touch them. They cannot be mined, farmed, manufactured, stored, transported, or stocked. A service's advantages are only felt when it is provided. For instance, while using smartphones to do transactions or dealing with bank employees at branch locations, we experience the perks of banking services.
2. Inventory- They cannot be stored for later use. Once the provider delivers the service, it is no longer available. It's distinct from products. We'll be able to keep them. Then, we use them again a few days or perhaps a few years later.
3. Inseparability- The supplier must provide the service at the moment of use. Unlike a good, a service can only be rendered and used while the provider is present.
4. Inconsistency- the same as "variability." Every service is different. It cannot be duplicated because even if the customer requests the same service, the time, place, circumstances, conditions, existing configurations, and allocated resources will alter for the subsequent delivery. A particular service is never given in the same way it was or is going to be future. Although they may appear similar, my haircut today compared to the one I had two months ago is not precisely the same. However, products are identical, particularly those that are produced on a manufacturing line. The factory produces two Chocolate Bars on Monday morning, the first identical to the second. They are identical to every other product that the company produces every day.
5. Involvement- A service's offering involves customer and supplier involvement. For instance, a haircut involves both the client and the hairdresser being present. Both are necessary to perform the service.