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Skill Module 9.1
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Facing Intangibility and Perishability

Because service industry businesses are so diverse, there can be no hard-and-fast list of characteristics to use in facing intangibility and perishability. For example, we want a quick service restaurant (like McDonald's or your local small business equivalent) to provide a meal in a couple of minutes, but at a premium restaurant (like Ruth's Chris Steakhouse or your local small business equivalent), we expect more leisurely service. Similarly, most of us want that meal at pretty much the same time, so restaurants often are their busiest around noon or 6:00 P.M. That time sensitivity means that restaurant sittings are perishable. If you had an empty table at lunch, you’ll never make that money up again.

So put on your thinking cap and work in a team to come up with some ways to handle the problems of intangibility and perishability in one of the following service industries:

    A restaurant specializing in soup
    A Web site specializing in self-recorded music
    A bookkeeping firm
    A housekeeping service
    A rooftop cell-phone tower rental service
    An online sporting goods retailer
    An 800-number health advice service
    A home-based child care service
    A house-sitting service
    A business consultancy specializing in tax advice

For intangibility, what kinds of symbols would help make your service seem more tangible to potential customers, and what kinds of qualities would help strengthen the customer benefit or value of the service? Test these out with other groups in class.

For perishability, identify if there are times of peak demand for the service, and if there are limits to how many customers you can serve at once. If there are peak times or customer service limits, explain how you would organize your business to get the largest sales possible. Test these out with other groups in class.








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