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A Service is any act or performance that one party can offer to another that is essentially intangible and does not result in the ownership of anything. Its production may or may not be tied to a physical product. A service is an activity or series of activities of more or less intangible nature that normally,  not necessarily,  takes place in interactions between the customer and service employees and /  or physical resources or goods and/or systems of the service provider,  which are provided as solutions to customer problems.


This highlights the following important features

  • Services are by and large activities
  • As a result the services are intangible
  • They take place in the interaction between the customer and service provider, which means that the services are produced and consumed simultaneously Services now account for more than 70% of employment and GNP of most industrialized nations.


Characteristics of Services

The main characteristics of services are Intangibility, Inseparability, Heterogeneity, and Perishability. Intangibility refers to the aspects not associated with any physical form or characteristics. It is very much pronounced in the pure service element like the lecture given by a Professor.


Inseparability refers to the fact that production and consumption of the services are inextricably intertwined. Heterogeneity or Variability is a result of the fact that Services are usually delivered by Human beings, whose performance is necessarily variable;  quality control is extremely difficult. It makes it difficult to standardize the output of certain services. Perishability means that the service "units" cannot be stopped. If a seat is unfilled when a plane leaves or the play starts it cannot be stored and sold on next day or next week. The revenue is lost forever.



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