Product and Service: Understanding the Key Differentiating Factors

This report provides a detailed comparison between products and services, highlighting their key differentiating factors. The author begins by defining the two types of offerings, emphasizing that products are tangible while services are intangible. The report then explores the core differences through several characteristics: intangibility, inseparability, variability, and perishability. Intangibility is discussed in terms of the inability to assess a service before purchase, leading to management challenges in making services more tangible. Inseparability focuses on the simultaneous production and consumption of services, requiring careful attention to customer interaction and employee training. Variability discusses how service quality can fluctuate based on the provider and environment, and the report suggests strategies to mitigate this. Finally, perishability explains how services cannot be stored, creating challenges in managing supply and demand fluctuations. The report concludes by emphasizing the implications of these differences for businesses and the need for well-developed strategies to address them.

Difference between Product and service
Name of student:
Name of University:
Author Note:

Any business offers two types of offerings. It is either a service or a product. While service sis
referred to those that are the intangible offerings by the company which can be asked for, the
products are physical beings which are needed or used for specific purposes. The following piece
will discuss in detail the main features of a service that distinguishes it from products:
1. Intangibility: A service is intangible which means it cannot be felt, seen, tested or heard
before being bought. It is not possible for potential customer to judge and perceive the
quality of service before, and even during as well as after the purchase. A product on the
other hand is tangible and physical (Rosca Arnol and Bendul 2017.). The customer can
actually see the product bfore buying and then decide upon his choice of buying or not.
For example, a car is product which the customer can see and touch. He can even
get a review of the features and parts of the car. However, if this car gets damaged, the
repairing of the car becomes a service. The customer is not able to see what is being
done.
Implication:
These intangibility posses a sense of problem to the customers, as they face difficulty in
having knowledge about the service before purchasing. The challenge for the service provider
thus remains in the fact that they have to determine the extent of determining the intangibility
and the actions of management for making it more tangible.
2. Inseparability
In terms of sequence of production and consumption, the difference between service and
product is distinct and marked. Products are generally produced first and are then stored
to be finally sold as well as consumed (Chaudhuri 2012). The service on the other hand is
first sold, then produced and finally consumed. Moreover, there are also instances where

for the production of various services like counseling, rail travels, hair dressings etc, the
consumer has to be present physically. The potential inseparability of this production and
consumption is a glaring difference between the product and the service.
Implication in service:
The production as well as the delivery of the service involves the customer which
means that the provider of the service has to exercise a considerable amount of care in the
process and the service being produced. For example a teacher, lawyer, hairdresser etc.
performs their services in front of the customer which is a great indicator of repating the
business again. Thus, a proper selection process as well as the training of the personnel
who are coming in contact with the customer is required (Araujo and Spring 2016.).
3. Variability- One of the major differences between a product and a service is the
consequence of simultaneous production and consumption leading to variability while
performing a service. The quality of the service may differ depending on the change of
the person who is conducting the service and for whom the service is being done. The
external and the internal environment and also the customer’s attitude affect greatly a
service. A product on the other hand tends to remain non- variable in terms of the
presence of customers. For example within a hotel one employee can be arrogant and
rude while the other can be friendly and courteous.
Implication-
The determination of the cause greatly helps in reducing the variability of the service.
The variability may often come from unsuitable personality traits within an employee
which is not always possible to detect during the time of selection. However, proper
training and good supervision may be helpful in this case. Arguments for the replacement

of labor with a production line approach to the operation of service can be taken into
account, however, it increases the chance of standardization of procedures.
4. Perishability-
Another major difference between product and service is that products can be stored and
remodeled for later use or sale. Services on the other hand cannot be stored. For example if a
room in a hotel is not occupied or dome seats in airlines are not purchased it cannot be
reclaimed since the services are actually performance which cannot be stored (Abernethy and
Butler 2012.). Thus, when demands are increased there is nothing to do in case of service for
exceeding the supply because service cannot be manufactured.
Implication-
These fluctuations in the demand and supply possess a great threat to the service industry.
Such fluctuations are unpredictable and thus well developed strategies are required for
making a better match.

Reference List:
Abernethy, A.M. and Butler, D.D., 2012. Advertising information: services versus
products. Journal of Retailing, 68(4), p.398.
Araujo, L. and Spring, M., 2016. Services, products, and the institutional structure of
production. Industrial Marketing Management, 35(7), pp.797-805.
Chaudhuri, A., 2012. A study of emotion and reason in products and services. Journal of
Consumer Behaviour: An International Research Review, 1(3), pp.267-279.
Rosca, E., Arnold, M. and Bendul, J.C., 2017. Business models for sustainable innovation–an
empirical analysis of frugal products and services. Journal of Cleaner Production, 162, pp.S133-
S145.