Goods and services

Template:Short description Template:More footnotes Template:Use dmy dates Template:Multiple image Template:Capitalism sidebar Template:Economics sidebar Goods are items that are usually (but not always) tangible, such as pens or apples. Services are activities provided by other people, such as teachers or barbers. Taken together, it is the production, distribution, and consumption of goods and services which underpins all economic activity and trade. According to economic theory, consumption of goods and services is assumed to provide utility (satisfaction) to the consumer or end-user, although businesses also consume goods and services in the course of producing their own.

HistoryEdit

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Physiocratic economists categorized production into productive labour and unproductive labour. Adam Smith expanded this thought by arguing that any economic activities directly related to material products (goods) were productive, and those activities which involved non-material production (services) were unproductive. This emphasis on material production was adapted by David Ricardo, Thomas Robert Malthus and John Stuart Mill, and influenced later Marxian economics. Other, mainly Italian, 18th-century economists maintained that all desired goods and services were productive.<ref name="Shubik2014">Template:Cite book</ref>

Service-goods continuumEdit

File:Service-goods continuum.png

Service-goods continuum

The division of consumables into services is a simplification: these are not discrete categories. Most business theorists see a continuum with pure service at one endpoint and pure tangible commodity goods at the other. Most products fall between these two extremes. For example, a restaurant provides a physical good (prepared food), but also provides services in the form of ambience, the setting and clearing of the table, etc. Although some utilities, such as electricity and communications service providers, exclusively provide services, other utilities deliver physical goods, such as water utilities. For public sector contracting purposes, the electricity supply is defined among goods rather than services in the European Union,<ref>UK Legislation. "The Public Contracts Regulations 2006" Template:Webarchive. Regulation 2(1) s.v. "goods". Retrieved 25 June 2015</ref> whereas under United States federal procurement regulations, it is treated as a service.<ref>Federal Acquisition Regulation, Subpart 41.2 — Acquiring Utility Services Template:Webarchive, accessed 12 May 2018</ref>

Goods are normally structural and can be transferred in an instant while services are delivered over a period of time. Goods can be returned while a service, once delivered cannot.<ref>Template:Cite news</ref> Goods are not always tangible and may be virtual e.g. a book may be paper or electronic.

Marketing theory makes use of the service-goods continuum as an important concept<ref>Indiaclass, "Goods Service Continuum". Accessed 25 June 2015. Template:Webarchive</ref> which "enables marketers to see the relative goods/services composition of total products".<ref>Bachelors of Management Students Portal (BMS.co.in). "Explain the Goods-Service Continuum" Template:Webarchive, accessed 25 June 2015</ref>

In a narrower sense, service refers to quality of customer service: the measured appropriateness of assistance and support provided to a customer. This particular usage occurs frequently in retailing.<ref>{{#invoke:citation/CS1|citation |CitationClass=web }}</ref>