REASONS FOR GROWTH OF SERVICES
Manufacturing industries grew because they produced
tangible goods which satisfied man’s physiological needs of food, shelter and
clothing. As the basic need was fulfilled there was demand for improved
satisfaction, and this led to a proliferation of variations of the same product
and a number of companies involved in its manufacture. The growth of service industries
can be traced to the economic development of society and the socio-cultural
changes that have accompanied it. Changing environmental forces brought out the various types of services in forefront of the economy. These
environmental forces separately or in combination create new type of service. The
following environmental factors are responsible to make a new service.
(i)
Consumer affluence: Due to the fast rise in the income of consumers, they are attracted towards
the new areas like clubs, health clubs, domestic services, travel and tourism,
entertainment, banking, investment, retailing, insurance, repairs, etc. and
these are growing much faster than ever before. There is a significant change
in the pattern of family expenditure.
(ii)Working women: During the recent times a large number of women have come up in a variety
of professions. The work performance of women in most of services sector like
bank, insurance, airlines, etc. is highly appreciable. In short, women are
getting involved in almost all male dominated activities. Due to increasing
involvement of women in commercial activities, the services like domestic
activities, fast food restaurants, marriage counseling, personal care,
financial services, retailing, etc. have emerged in the recent times.
(iii)
Double income no kids (DINK): Dinks are the working couples who have consciously postponed parenthood
plans indefinitely or in an increasing number of cases, have decided not to
have any children ever. The dink culture is getting stronger and spreading
wider day by day. The realisation that parenthood is likely to result in more
commitments at home and demands on their time, thereby slowing down their
career plans and ambitions, make them postpones their parenthood plans.
Whatsoever be their life style, they have double income and no kids, resulting
in the emerging and enhancing of services like, entertainment, hotels and
restaurants, career institutes, domestic services, travel resorts, personal
care, etc.
(iv) Leisure time: People do get some time to travel and holiday, and therefore, there is a need
for travel agencies, resorts, hotels and entertainment. There are others who
would like to utilise this time to improve their career prospects, and
therefore, there is a need for adult education, distance learning, part time
courses, etc.
(v)Greater life expectancy: According to the World Development Report and World Human Resource Index,
the life expectancy of people has increased significantly all over the world
barring few developing countries. It may be due to the advancement in the
medical technology, and greater awareness about health and education. Greater
life expectancy invites opportunities in services like hospitals, Nursing
Homes, entertainment, leisure services, investment banking and so on.
(vi)
Product innovations: In the changing time the consumers have become more conscious of quality
than cost. They need high quality goods at par with international standards.
Having this in mind the manufacturers have focused their attention on quality
improvement, innovations, etc. In this process many more services have emerged
on account of product innovation. Some of them are servicing services, repairs,
computer, training and development, education, etc.
(vii) Product complexity: A large number of products are now being purchased in households
which can be serviced only by specialised persons e.g. water purifiers,
microwave oven, computers, etc., giving rise to the need for services. The
growing product complexities create greater demand for skilled specialists to
provide maintenance for these complex products and bring out other services
like expert advice, consultancy services, etc.
(viii)
Complexity of life: Certain product and services have made human life more comfortable
and complex as well. Also, life itself has become more complex due to the
socio-economic, psycho-political, technological and legal change. This has
brought about the emergence of services like legal aid, tax consulting,
professional services, airlines, courier services, insurance, banking, etc.
(ix)
New young youth: Every new generation has its own characteristics and enjoys a different
life style. There is a lot of difference between the generations in respect to
their living conditions/ styles, maturity, thinking, attitudes, behavior,
beliefs, satisfactions, performance values and so on. Today’s generation with
all these changes provide more opportunities to services like entertainment,
fast food, computers, travel, picnic resorts, educational institution, counseling,
retailing, etc.
(x)
Resource scarcity and ecology: As the natural resources are depleting and need for conservation is
increasing, we have seen the coming up of service providers like pollution
control agencies, car pools, water management, etc.
(xi)
Corporate crowd: The phenomena of “Globalization, Privatization
and Liberalization” coupled with faster urbanization
have created the corporate world crowd and its support services. This crowd is
responsible in bringing the new services, and redefining the old ones. The
services like hotels and restaurants, banking, insurance, travel and tourism,
advertising, airlines, courier services, marketing research, health care, legal
services, etc. will emerge and flourish more and more.
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