Key words:

Services in the European Union, services specifics, services classification, market and non-market services, logistics processes 

 Chapter objectives:

• to acquire knowledge about services in the European Union,
• to acquire knowledge about services specifics and market and non-market services,
• understanding the importance of services and getting familiar with the services classification,
• getting acquainted with logistics processes.

 Time required to study the chapter: 8 hours

 Interpretation:

Services in the European Union:

Services in general

At present, the principle of services is explained, for example by American authors Kotler and Armstrong (Vaštíková, 2008), like this: The service is any activity or benefit which can be offered by one party to another party; it is basically immaterial (intangible) and the result cannot results in ownership. Service production may or may not be associated with a tangible product.
 

Services specifics:

The most important services features include:

• immateriality,
• inseparability,
• heterogeneity,
• degradability,
• impossibility of its ownership.

Services classification:

The simplest way of defining the term services is represented by the exclusion method - "services are that part of the economy that remains after deduction of agriculture, production and mining".

Economic activity:

• Primary sector - primary production
• Secondary sector - manufacturing industry​
• Tertiary sector - services

                    1. Branches division
                    2. Division according to expediency criterion - market, non-market
                    3. Division according to recipient - services for consumers, services for organizations

Market and non-market services:

• Management consulting services,
• Advertisement,
• Sales representative services,
• Legal or tax advice,
• Real estate services, such as real estate agencies,
• Construction, including architects services,
• Organization of trade fairs,
• Car rental,
• Travel agencies,
• Amusement parks,
• and other.

As for other services, the EU has not liberalized the services market yet. These include mainly national provided (non-liberalized) services, as follows:

• Childcare, social housing or services for families,
• Financial services,
• Electronic communications services and networks,
• Services in the field of transport,
• Health services,
• Audiovisual services,
• Gambling,
• Social Services,
  and other.

Logistics processes:

The flow of material, information, finance, planning, and management is never considered independently; these are logistics processes. These concurrent logistics processes have to meet and promote each other at exactly given specific points in order to act synergistically and lead to the most effective achievement of the enterprises's business goals.
 

Relevant logistics processes include:

1. Purchase

2. Stocks (inventory)

We recognize the functions of each type of stocks (inventory) that affect inventory management:

     A. Disconnecting inventory,

     B. Inventory on the logistics route,
   
     C. Technological inventory,

     D. Strategic inventory,

     E. Speculation inventory,

Inventory are further divided into usable and unusable. 

3. Storage

4. Transport

 Study materials:

Basic literature:

DOLEŽELOVÁ, H., HALÁSEK, D. Služby v obecném hospodářském zájmu v EU - Komparace České republiky a Německa. Department of Public Economics Faculty of Economics, VSB-Technical University Ostrava, Czech Republic, 2011. ISBN 978-80-248-2371-3

VAŠTÍKOVÁ, M. Marketing služeb. Grada Publishing, Prague, Czech Republic, 2008, 232p. ISBN 978-80-247-2721-9

Recommended study materials:

HALÁSEK, Dušan. Ekonomika veřejného sektoru. 1. ed. VSB-Technical University Ostrava, Czech Republic, 2008. IV, 230 p. ISBN 9788024818542

LAMBERT, Douglas M, James R STOCK a Lisa M ELLRAM. Logistika. In Praxe manažera. Ed. 2. Brno: CP Books, 2005. 589 p. Praxe manažera. ISBN 80-251-0504-0

 

Questions and tasks

1. At present, the principle of services is explained, for example by American authors Kotler and Armstrong (Vaštíková, 2008), like this:
   Transmission of information by telecommunications networks for a fee to third parties. 
   It is any activity or benefit which can be offered by one party to another party; it is basically immaterial (intangible) and the result cannot results in ownership.
   State administration, types and forms of health care, rights and obligations of patients and persons close to patients, health service providers. 

2. The most important services features do not include:
    inseparability 
   heterogeneity 
   possibility of its ownership

3. Within services classification​, services are part of the:
   Tertiary sector 
   Primary sector 
   Secondary sector
4. Relevant logistics processes do not include:
   Transport
   Storage
   Social services
5. We recognize the functions of each type of stocks (inventory) that affect inventory management. These do not include:
   Inventory of customer service 
   Disconnecting inventory 
   Technological inventory

 

Key to solve the questions:

1. B
2. C
3. A
4. C
5. A