III) On the basis of form –
Tangible goods and intangible goods [Material goods / Non Material goods/goods and services/ transferable and non transferable goods].
Tangible means capable of being touched. Therefore tangible/physical goods are defined by their ability to be touched, they include goods which a customer see, feel, touch, hold, photograph, transfer etc. Tangible goods are material assets that can be perceived by human senses. They are manufactured goods.
Tangible goods have a standardised process of production.
Durable tangible goods can be stored and used more than once. Perishable tangible goods cannot be stored and can be used only once
Production of tangible goods require high capital intensity through automation
Production of tangible goods precedes consumption. There is a time lag between their production and consumption.eg everything that we put in our shopping cart in a shopping store, jewellery, computers, clothing, CD’s and DVD’s, groceries, baseball bat, books, a piece of furniture, a cheeseburger etc.
An intangible good is a good that does not have a physical existence; it cannot be seen, touched, felt, photographed, transferred etc as opposed to a physical good (an object). Tangible goods are material assets that cannot be perceived by human senses. They also include services.
Intangible goods involve customisation.
Intangible goods cannot be stored and can be used only once
Production of intangible goods is Labour-intensive/Knowledge work
Consumption of intangible goods is at the point of production (implies proximity). They are produced and consumed simultaneously. There is no time lag between their consumption and production eg a dance by a dancer is a service which is enjoyed by the spectators as and when it is performed eg advice, a piece of music, music downloaded from the web, domain names, computer programmes etc.
In an increasingly digitized world, intangible goods play a more and more important role in the economy. Virtually anything that is in a digital form and deliverable on the internet can be considered an intangible good.
In ordinary sense, an intangible good should not be confused with a service. They are distinct from services, since a good is an object whereas a service is a labour. A spa treatment is a service, a haircut is a service not intangible goods.
Both tangible and intangible goods are needed for growth of a business.