Compare the manufacturing, merchandising, and service sectors. How do they differ as to the kinds of...

Question

Compare the manufacturing, merchandising, and service sectors. How do they differ as to the kinds of businesses in each category, the nature of their output, and type of inventory, if any?

Robert · Accepted Answer

Goods 
 The output of a service firm, such as consultancy, training or maintenance, 
for example, is intangible. Manufacturers produce physical goods that 
customers can see and touch. merchandisers sells the products 
manufactured by the manufacturers. Merchandisers include both 
wholesalers and retailers 
 
Inventory 
Manufacturers have three classifications of inventory: raw materials, work 
in process and finished goods. Manufacturers produce goods for stock, 
with inventory levels aligned to forecasts of market demand. 
 Contrastingly, merchandisers do not maintain but one of these three, that 
is finished goods 
Service firms, unlike manufacturers, do not hold inventory; they create a 
service when a client requires it.  
 
Customers 
Manufacturers can produce goods without a customer order or forecast of 
customer demand. However, producing goods that do not meet market 
needs is a poor strategy. 
Merchandisers buy products according the need of the customers. 
However , they also check for new customers in order to increase their 
market share.

Compare the manufacturing, merchandising, and service sectors. How do they differ as to the kinds of businesses in each category, the nature of their output, and type of inventory, if any?

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