What are services?Explain their distinct characteristics

The service sector constitutes the basic infrastructure which is necessary for the smooth flow of business activities. In the recent past, the role of service sector in the Indian economy is growing faster than agriculture and industrial sectors.

  1. Intangibility : Services are intangible, i.e., they cannot be touched. They are experimental in nature. One cannot taste a doctor’s treatment or touch entertainment. One can only experience it.
  2. Inconsistency: The second important characteristic of services is inconsistency. Since there is no standard tangible product, services have to be performed exclusively each time.
    different customers have different demands and expectations.
  3. Inseparability: Another important characteristic of services is the simultaneous activity of production and consumption being performed. This makes the production and consumption of services seem to be inseparable.
  4. Inventory : Services have little or no tangible
    components and therefore, cannot be stored for a future use. That is, services are perishable and providers can at best store some associated goods but not the service itself.
  5. Investment : One of the most important
    characteristics of services is the participation of the customer in the service delivery process