Perishability

Services cannot be stored; once an airplane takes off or a movie starts, any unsold seats cannot be held for future sale. Perishability is not a problem when demand for a service is steady, but fluctuating demand can cause problems. For example, public-transportation companies have to own much more equipment because of higher rush-hour demand,just as Charles Schwab must have sufficient server capacity to handle its brokerage customers' on-line trading during peak stock market periods.

Service providers can deal with perishability challenges in a number of ways. Table 4.3 shows some strategies proposed by Sasser for better matching demand and supply in a service business.9

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