Product (economy)

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In business administration, a product is understood to be a material good or an (immaterial) service that is the result of a production process .

General

In economics, the term product is often equated with the term product . In business accounting and balance sheets , one speaks of finished and unfinished products . Products that a company offers on the market are also referred to as end products or end products . Due to different technical requirements and tasks, there are also different product classifications, product types and product descriptions in the business disciplines. From a business point of view, a strict separation must be made between products and services, even if they are often summarized in statistics such as the gross domestic product or national income .

Legal issues

The product is also a legal term , which in § 2 ProdHaftG a legal definition given "product under this Act, every movable thing , even if it forms part of another movable or immovable property, as well as electricity ." Immovable things like real estate are therefore not products, but rather their components. This legal definition is necessary in order to subject products to strict strict liability, to which manufacturers are subject. A product has to § 3 para. 1 ProdHaftG an error if it is not the security provides that, where it in all the circumstances, particularly his performance, use, can be expected to reasonably and timing marketed can reasonably be expected. According to Section 4 (1) of the ProdHaftG, a manufacturer is deemed to be anyone who has manufactured the end product , a basic material or a partial product or who claims to be the manufacturer by affixing his name , brand or other distinctive sign .

Production economy

In the production economy , products are the result of production, regardless of whether the company wants to sell them or use them itself (e.g. self-made machines from a machine manufacturer). The agricultural production produced agricultural products , which at low processing the natural products belong. In a broader definition, undesirable results of production are also referred to as products, such as exhaust gases, waste or scrap. In the production program all product types and quantities are included, which wants to establish a business.

Marketing and Sales

From the perspective of the consumer, a product represents a means of satisfying needs and thus also of obtaining benefits . Based on Philip Kotler (1972), a distinction is made between three different product terms:

  • Substantial product term : the core product as a bundle of physical-technical properties with the aim of satisfying functional customer needs through the physical characteristics of the product.
  • Extended product term : the product is seen as a service package consisting of physical products and / or immaterial services, with the help of which the comprehensive satisfaction of functional customer needs is to be achieved.
  • Generic product term: this term includes all material and immaterial facets from which customer benefits can result; In addition to the functional benefit, other benefit categories are also taken into account (e.g. emotional or social benefit).

Christian Homburg and Harley Krohmer define a product as a bundle of properties that aims to create customer benefits.

Product / product breakdown

For a physical product, the word is often product used interchangeably: "products are self-contained, consisting of a number of groups and / or parts of functional objects (eg machinery, equipment.) As manufacturing final results" ( DIN 6789 ) . One also speaks of product structure or product classification, which must be known for production planning and control and for procurement and logistics . The product structure and the required components that make up the product are shown in parts lists or recipe lists . In the case of complex products, the product structure is divided into several levels according to the production stages and can thus be mapped in different parts lists, which enables better production planning and control. In contrast to the end product, products that are not yet usable or functional are also called intermediate products ; In production engineering and metallurgical engineering, one also speaks of: Semi-finished product or semi-finished product = product standing between raw material and finished product, which still has to go through further production stages.

In the course of Industry 4.0 , the real physical product is digitally mapped, which is also known as a digital twin .

Product classifications

Mass product

A product that is only manufactured in large numbers or quantities, i.e. in mass production , is also known as a mass product .

Serial product

A product whose various variants are manufactured in series or whose variants are produced in more or less large batch sizes is also referred to as a series product .

Niche product

A product that only covers a small part of the demand in the overall market on the niche market is called a niche product .

Individual product

A product that is individually manufactured for each customer or order is called an individual product ( mass customization , class market ).

By-product

A product that inevitably arises in addition to a main product for technical production reasons is called a by-product .

Product components

A product is made up of several components that build on one another, all of which are beneficial:

  • Product core: consisting of the core properties that significantly determine the functionality of the product . In the case of a car, for example, the engine or the tires are part of the product core - a car without wheels is of no use to the consumer or is not a car.
  • Additional properties: Properties that generate benefits that are not based on the core (functional) function of the product. In the example of the car, one could think of an air conditioning system or a car radio. You could do without these without reducing the core benefit of the car - the journey from A to B.
  • Packaging / design of the touchable environment : protection of the product, easy handling, ensuring product transport, influencing purchases, etc. For a car, for example, garage parking spaces or protective tarpaulins as well as paintwork and coloring, the material used and the like can be listed as examples.
  • Basic services : those services that the customer expects from the provider when purchasing the product. For example, a car buyer will want to get advice from his provider about the vehicle or about possible contract models - purchase or leasing.
  • Additional services : also referred to as "Value Added Services", are services that provide the customer with additional benefits, but are not a purchase requirement for them. Example: cleaning the car during an inspection.

Product types

Products can be typified in general, for example according to criteria such as the materiality of the service, the carrier of the need or the service life:

  • Material goods
  • Services
    • Consumer services
      • continuously created services as part of a membership
      • continuously created services without a formal relationship
      • Occasionally created membership services
      • occasionally created services without a formal relationship
    • Investive services
      • industrial services
      • purely investment services

It has also become common to speak of products when it comes to services as intangible products. This is particularly true of finance , where there is talk of financial products .

Product description

The description of a product depends on the one hand on the product type and the number of product components, and on the other hand on the technical task that is being pursued. Due to the increasing variety and individualization of products as well as globalization (many markets, different climatic zones, different laws, several languages), the scope and complexity of the product description has increased significantly.

Technical product description

From a technical point of view, a product is mainly described by geometric information in the form of a technical drawing or CAD data. In addition to the geometry data - depending on the product - information on the raw material used, the material quality, physical properties or chemical composition is required. Information on functional properties, such as in particular for electronic control units or software , is part of the technical product description. (see also product (technology) )

Commercial product description

From a commercial point of view, a product must be described by a unique identification number ; In this context one speaks of the product definition, which is implemented with the help of a specific numbering . In the case of simple products, the identification number is often a purely identifying product number. For products with few variants, this product number is often supplemented by a classifying (speaking) number, with an additional 'number' being required for each different product property. Example: in a catalog a very specific dress is offered under a very specific article number, but the customer must also select or specify the dress size and color. However, this type of product description has limits if the product can have very many different properties. Products with a particularly large number of variants are described by a large number of features that can be loosely or in a certain way. Ordered features that meet the requirements of an ideal Boolean set algebra are also called options, with basic options describing the basic features of a product and additional options describing the additional features. There are numerous product configurators on the Internet for describing products with a large number of variants , which support customers in configuring their desired product variant. This is often not easy with complex technical products, as various dependencies between the properties to be selected have to be taken into account. In a certain vehicle, for example, not all engines can be combined with all transmissions, and not all tire sizes can be selected for the permissible engine-transmission combinations, etc. etc.

The product number is the reference to the parts list , which lists the components that make up the respective product. This partially related information is necessary in particular for the verification of product quality , product safety and product liability , but also important for the production and procurement of the required components.

Use-related product description

The operation of a technical product is described in an instruction manual so that the buyer can use this product properly and safely. The handing over of instructions for use together with the product is regulated by law in Germany and is part of the manufacturer's duty to instruct in the context of product liability .

Maintenance and repair-related product description

For long-lasting technical products and systems, the manufacturer creates documents for maintenance, repair and technical inspection of the product. These are i. d. Usually only intended for technically trained personnel, as special repair tools and spare parts are often required. The automobile manufacturers supply their authorized workshops ( vehicle workshops ) with appropriate repair guides, maintenance tables or repair brochures so that the vehicles can be serviced (see maintenance ) and repaired (see repair ) according to the manufacturer's instructions .

Marketing-oriented product description

In order to be able to sell a product, a product description is created in marketing , which particularly addresses the potential customers (customer groups) and above all emphasizes the advantages of the respective product.

See also

literature

  • Phillip Kotler, Kevin L. Keller, Friedhelm Bliemel : Marketing Management - Strategies for value-creating action. 12th edition. Person Education Germany, Munich 2007, ISBN 978-3-8273-7229-1 , p. 12 Chapter 1.2.2 Goods and other exchange objects
  • Christian Homburg, Harley Krohmer: Marketing Management Strategy - Instruments - Implementation - Corporate Management. 3. Edition. Gabler Verlag, Wiesbaden 2009, ISBN 978-3-8349-1656-3 , p. 536 Chapter 11.1 Conceptual basics of product policy
  • Wilmjakob Herlyn: PPS in automotive engineering - production program planning and control of vehicles and assemblies . Hanser Verlag, Munich 2012, ISBN 978-3-446-41370-2 .

Web links

Wiktionary: Product  - explanations of meanings, word origins, synonyms, translations

Individual evidence

  1. ^ Hans Corsten: Production Management . 10th edition. Munich / Vienna 2003.
  2. ↑ Phillip Kotler / Kevin L. Keller / Friedhelm Bliemel , Marketing Management - Strategies for Value-Creating Action , 2007, p. 12
  3. ↑ Wilmjakob Herlyn: PPS in the automotive industry. Hanser Verlag, Munich 2012, p. 76 ff.
  4. ↑ Wilmjakob Herlyn: PPS in the automotive industry. Hanser Verlag, Munich 2012, ISBN 978-3-446-41370-2 , pp. 79-88.