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Product-Based vs Service-Based Companies: Key Differences
As a fresher, every IT aspirant would have faced the question, “Are you going to join a product based company or a service-based company?”. Many times, they’ll be left with no answer. Today, we’ll discuss what really product-based and service-based companies are and what perks and cons they have.
What are product-based and service-based companies?
As the name denotes, a product based company builds products for consumers at various levels and markets it. A service-based company, on the other hand, offers its service when a customer approaches them. Examples of product-based companies include Myntra, Apple, Zebronics, etc. And Codingmart, TCS, Wipro are some examples of service-based companies.
Still incomprehensible? We’ll simplify it further. As Diwali is nearing, imagine you are going to a tailor to get your dress stitched. The tailor will measure the dimensions of your body and tailor a perfect fit shirt for you. You can ask him to add a specific color button, specific design, etc. He’ll do that according to your requirements. Now, imagine if you are going to a clothing store to buy a ready-made shirt. There, you’ll see that the shirts are already made according to standard sizes. You’ll choose the size and color that suits you the most. Here, the tailor example best explains the service-based companies while the readymade shirt example explains the product based companies. Hope your doubts have been elucidated, isn’t it?
Product-based companies build products such as smartphones, electronic items, software products like Illustrator, mobile apps like that book etc. These products are then marketed and then delivered to the audience. But, that’s not the case for service-based companies. They don’t manufacture or own any product or brand of them. Codingmart is a good example. When customers approach Codingmart with their challenges, we come up with technologies and digital tools to tackle those challenges and cater to their exclusive needs.
Which company is the best to work with?
Do you have superlative communication skills? Are you a good marketer? Can you adapt to situations well? If your answer to all these questions is yes, then service-based companies are best suited for you. In service-based companies, often you may need to go to clients’ place or handle clients to understand their requirements better. It requires you to adapt to situations better. On the other hand, are you a design thinker? Are you a tech-savvy person with a hold of all the latest technologies? If then, Product based companies welcome you the most.
Recent studies also show that service-based companies are performing well in comparison to product-based companies. COVID-19 has provided a slight boost to service-based companies, especially in the IT sector meanwhile the product-based companies faced numerous challenges due to shutting down of the manufacturing units. However, they are slowly taking the leap and retrieving their charm.
