In business, a product is an item offered to satisfy a market need or want. It is a result of a series of processes, and it has several different aspects. In addition to its appearance, it also offers benefits to potential customers. Here are some of its attributes.
Characteristics of a product
Product characteristics can be categorized into two categories, the explicit and the implicit. The explicit characteristics are the ones which can be agreed upon by all the stakeholders. The implicit characteristics refer to the features which are related to the product’s construction or composition. Such features are measurable in a nominal sense but not in a continuum sense.
Product characteristics measure to determine how important a particular product feature is to consumers. This metric is called salience, and it reflects the degree of consumer desire for a product’s corresponding characteristic. The characteristics can range from specific purchasing criteria to abstract subjective perceptions. Some examples of intrinsic features of a product are its price, durability, and sex appeal.
The product’s relationship to other products is also a part of its explicit characteristics. This relationship influences both the seller and the buyer’s perception of the product. Consumers normally do not think of the product in isolation, knowing that it is part of a family of products made by the same company.
Product characteristics also play an important role in the success or failure of a marketing program. By knowing the characteristics of a product, a marketing manager can effectively determine the appropriate strategy for its marketing. For instance, a defective product may cause long-term damage to the company, so it is imperative for marketing managers to monitor product quality regularly. They must also ensure that they are able to supply a sufficient quantity of a product and set a price that is competitive.
Types of products
There are various types of products available on the market. It may be a raw material, refined material, finished item, or a combination of these. It can also be non-tangible, such as services or virtual products. Books, computer software, and online education materials are examples of non-tangible products. Consumer products are finish items that people buy and use. They are classified according to their price and characteristics. Convenience products are often cheap and readily available.
A product can be classified according to the type of customer that bought it. Industrial products are bought by organizations, while consumer goods are purchase by individuals. Industrial products, such as air-conditioning equipment, lorries, and cooling towers, are purchase by organizations. Individuals purchase these products for consumption and special occasions, like birthdays or Christmas.
Products can divide into general categories, including consumer products, industrial products, and intangible products. Some products are new to the market or create by a company for sale. Consumer products include DVD players, specialty items, and electronic equipment. In the industrial world, products include capital plant and equipment, accessories, and materials and components. A business may also sell services, which are intangible or non-tangible.
Component materials include the raw materials that process into a finished product. Component materials include mineral or farm products, natural gas, and forest products. These materials lose their unique characteristics once they transform into a finished product. Some products sell directly to an industrial user, while others sell through a middleman.
Specialty products differ in quality, style, and price from common goods. Consumers normally focus on price and style when selecting a specialty product.
Cost of a product
When calculating the cost of a product, you must take into consideration the total labor and material costs used to produce it. This includes direct labor, materials, production supplies, and factory overhead. In addition, the cost of services such as labor for assembly lines and should include cleaning supplies. Ultimately, you need to calculate the total cost of the entire process to determine the value of the product.
When making new products, companies have to start thinking about how to manage cost effectively. In the early stages of the development process, 60 to 70% of the total cost of a product is commit. By the time it is design, it may cost up to 85 percent of the total cost. Only 10 to 15% of the total cost is directly relate to the manufacturing process.
Once the cost of the product has been identify, it must divide by the ideal overall revenue. In addition, the variable cost partition must divide by the ideal overall revenue. A good example of how to calculate the cost is the production of 500 chairs. The labor costs include wages, benefits, and insurance. The total cost of the product includes the following costs:
The unit cost of a product can calculate by taking the total fix and variable costs of the production and dividing them by the number of units produce. This information will help companies determine how much to charge for their products while still leaving a reasonable profit margin. This information will also help the company analyze the cause of a cost increase.
Also read : What is Marketing
