The Difference Between A Product and Service

The Difference Between a Product and Service
Product
• Products are simply objects that are manufactured, stored,

transported, advertised, and then sold. Services
Services
• a government system or private organization that is

responsible for a particular type of activity, or for providing a
particular thing that people need
Tangible
• capable of being touched; discernible by the touch; material
or substantial. real or actual, rather than imaginary or
visionary
Intangible
• That exists but cannot be touched; cannot be measured.
Tangible
• Tangible Assets Tangible assets are physical and
measurable assets that are used in a company's operations.
Assets such as property, plant, and equipment are tangible
assets. Tangible assets form the backbone of a company's
business by providing the means by which companies
produce their goods and services. Tangible assets can be
damaged by naturally-occurring events. These assets include:
like stocks, bonds, and cash.
• There are two types of tangible assets: current and fixed.

• Current Assets Current assets include items such as cash
inventory, and marketable securities. These items can be
readily sold to raise cash (or emergencies and are typically
used within a year.
• Fixed Assets Fixed assets are non-current assets that a

company uses in its business operations for more than a year.
Thev are recorded on the balance sheet as Property, Plant,
and Equipment (PP&E). They include assets such as trucks,
machinery, office furniture buildings, etc. The money that a
company generates using tangible assets is recorded on the
Income statement as revenue. Fixed assets are needed to run
a business continually.
Intangible
Intangible Assets Intangible assets are nonphysical assets

used over the long term. Intangible assets are often
intellectual assets, and as a result, it's difficult to assign a
value to them because of the uncertainty of future benefits.
Intangible assets add to a company's future worth and can be
far more valuable than tangible assets. Intangible assets
are intellectual property that includes:
*Patents, which provide property rights to an inventor
*Trademarks, which are a recognizable phrase or symbol that

denotes a specific product and differentiates a company
*Franchises, which are a type of license that a party

(franchisee) buys to allow them to have access to a company's
brand and sell goods under its name
*Goodwill, which represents the value above and beyond a
target company's assets that another company pays when
acquiring the target company
*Copyrights, which represent intellectual property that's

protected from being used or duplicated by non-authorized
parties. Both of these types of assets are initially recorded on
the balance sheet, which helps investors, creditors, and banks
assess the value of the company.
Summary
A product is a tangible item that is put on the market for

acquisition, attention, or consumption, while a service is an
intangible item, which arises from the output of one or more
individuals. Although it seems like the main distinction
between the two concepts is founded on their tangibility, that
is not always the case.
One thing to keep in mind is that products and services are

closely aligned. In fact, a majority of products carry with them
an element of service. For example, when a consumer buys a
car, the product comes with a lot of other service
responsibilities, such as tune-up and maintenance.
The Difference between Product and Service

Tangible vs. Intangible
Assessing the quality of a tangible product is very easy. Since

most products are countable, touchable, and visible, a
consumer can assess its durability by examining it. A good
case in point is when an individual is buying a home. The
buyer will check every nook and cranny of the house.
Including the attic, basement, foundation, each individual
room, and more. In contrast, a service is not something that
one can feel or try out before paying for it. Say an individual
needs a professional inspector to identify any hidden issues
before deciding to purchase a home. Just how experienced is
the inspector with regard to plumbing, roofing, and other
structural matters?
In a nutshell, the client lacks sufficient knowledge about the

inspector's expertise until the task is already in progress. The
customer can read online
Production and Interaction

Production vs. interaction. A product is created through
production. For instance, a car is made possible thanks to
production lines that assemble individual parts into one solid
product referred to as a car and offered to the market for
acquisition. A potential car buyer usually feels the leather
used to make the seats and the body lines and also is able to
take the car for a test drive before deciding on whether to
acquire it.
On the other hand, a service does not go under an assembly

line like in the case of a product. It is a result of interaction
between the service provider and the recipient. For instance,
when buying a car, the buyer receives service from the
car dealer. For instance, a brief review of the car is a service
that is offered by the salesperson. The service did not go
through a production line to exist, rather is a result
of the interaction between the salesperson and the buyer.
 A product is created through production. For instance, a

car is made possible thanks to production lines that
assemble individual parts into one solid product referred
to as a car and offered to the market for acquisition. A
potential car buyer usually feels the leather used to make
the seats and the body lines and also is able to take the
car for a test drive before deciding on whether to acquire
it.
 On the other hand, a service does not go under an
assembly line like in the case of a product. It is a result of
interaction between the service provider and the recipient.
For instance, when buying a car, the buyer receives
service from the car dealer. For instance, a brief review of
the car is a service that is offered by the salesperson. The
service did not go through a production line to exist,
rather is a result of the interaction between the
salesperson and the buyer. product is that it focuses on a
product's features and benefits. Whereas, production
concept is making a product or providing a service
efficiently and cost-effectively production is the act of
producing, making or creating something
while interaction is the situation or occurrence in which
two or more objects or events act upon one another to
produce a new effect; the effect resulting from such a
situation or occurrence.
Production vs. Interaction

A potential car buyer usually checks the car's body lines. feels
the leather used on the seats, and takes the car for a test
drive before deciding whether to buy the car or not. Since it's
a product. the buyer is aware of the specific production line
the vehicle hails from, and there are many more like it. In
fact, there are other cars identical to the one being bought.
But what about the service the car buyer receives from the car
dealer? The way a car salesperson interacts with one buyer is
not the same way he interacts with another buyer. If the car
buyer is lucky, he may find a salesperson who is well-
informed, courteous, and is willing to negotiate. If he’s not,
the car salesperson might be one who lacks information or
behaves in a nonchalant way.
Source: (Entrepreneurship by Feliciano Fajardo 1994)

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The Difference Between a Product and Service

• Products are simply objects that are manufactured, stored,

• a government system or private organization that is

• There are two types of tangible assets: current and fixed.

• Fixed Assets Fixed assets are non-current assets that a

Intangible Assets Intangible assets are nonphysical assets

*Patents, which provide property rights to an inventor

*Trademarks, which are a recognizable phrase or symbol that

*Franchises, which are a type of license that a party

*Copyrights, which represent intellectual property that's

A product is a tangible item that is put on the market for

One thing to keep in mind is that products and services are

The Difference between Product and Service

Assessing the quality of a tangible product is very easy. Since

In a nutshell, the client lacks sufficient knowledge about the

Production and Interaction

On the other hand, a service does not go under an assembly

 A product is created through production. For instance, a

Production vs. Interaction

Source: (Entrepreneurship by Feliciano Fajardo 1994)

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