CHAPTER 4
BUSINESS SERVICES
LEARNING OBJECTIVES
After studying this chapter, you should be able to:
• state the characteristics of services;
• distinguish services from goods;
• classify different types of business services;
• explain the concept of e-banking;
•
identify and classify different types of insurance policies; and
• describe different types of warehouses.
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BUSINESS SERVICES
4.1 INTRODUCTION
You must all have, at some time or the
other experienced the effect of business
activities on your lives. Let us examine
few examples of business activity i.e.,
purchasing ice cream from a store and
eating ice cream in a restaurant,
watching a movie in a cinema hall or
purchasing a video cassette/CD,
purchasing a school bus and leasing it
from a transporter. If you analyse all
these activities, you will observe that
there is a difference between purchasing
and eating, purchasing and watching
and purchasing and leasing. What is
common in all of them is that one is
purchasing an item and the other is
experiencing a service. But there is
definitely a difference between the item
or good and the service performed.
For a layperson, services are
essentially intangibles. Their purchase
does not result in the ownership of
anything physical. For example, you can
only seek advice from the doctor, you
cannot purchase him. Services are all
those economic activities that are
intangible and imply an interaction to
be realised between the service provider
and the consumer.
Services are those separately
identifiable, essentially intangible
activities that provides satisfaction of
wants, and are not necessarily linked to
the sale of a product or another service.
All of us have seen a petrol pump. Have your ever thought how a petrol pump
owner does his business in a village? How he gets the petrol and diesel to the
villages in the interior? How he gets the money to purchase large quantities of
petrol and diesel? How he communicates to petrol depots for requirement and
also to customers? How he safeguards himself from various risks