Sharp Edges is a national barber shop chain. Sleepy Time is a company that designs and sells loungewear. How will the two businesses differ from each other?
Multiple Choice
a. Sharp Edges will be more capable of customizing its products when compared to Sleepy Time
b. Sharp Edges will be able to keep its output standardized, whereas Sleepy Time will not.
c. Sharp Edges will have less contact with its customers when compared to Sleepy Time
d. Sharp Edges will be able to incorporate quality standards, whereas Sleepy Time will not
e. Sharp Edges, unlike Sleepy Time, will not produce its output at the point of Cori Sumption.
The correct answer and explanation is :
Correct Answer: (e) Sharp Edges, unlike Sleepy Time, will not produce its output at the point of consumption.
Explanation:
The primary difference between Sharp Edges (a barber shop chain) and Sleepy Time (a loungewear company) lies in the nature of their outputs. Sharp Edges provides a service (haircuts and grooming), while Sleepy Time sells physical products (loungewear).
For service businesses like Sharp Edges, production and consumption occur simultaneously. A haircut cannot be stored or produced in advance; it is performed and consumed at the same time. This means that the quality of service is highly dependent on the barber’s skill at that moment and the customer’s immediate experience.
In contrast, product-based businesses like Sleepy Time manufacture goods separately from the point of sale and consumption. Loungewear is designed, produced in factories, stored in inventory, and then sold to customers who use it at a later time. This clear separation between production and consumption makes it fundamentally different from the service industry.
Why Other Answers Are Incorrect:
- (a) Incorrect: Sleepy Time can offer customizations (such as personalized designs or fabrics), while Sharp Edges may have standardized haircut styles.
- (b) Incorrect: Sharp Edges may vary its service quality based on the barber’s skill, whereas Sleepy Time can maintain uniform product standards.
- (c) Incorrect: Sharp Edges has more direct customer interaction since barbers work one-on-one with clients, whereas Sleepy Time primarily sells products without ongoing interaction.
- (d) Incorrect: Both businesses can incorporate quality standards, though in different ways (training for barbers, manufacturing quality control for Sleepy Time).
Thus, (e) is the best choice, as Sharp Edges must produce its service at the moment of customer consumption, whereas Sleepy Time does not.