Is the Transportation Industry a Service Industry?
※Note to the reader:
This is a column where I, a "person who thinks scientifically," verbalize and explain the anxieties that company presidents and management teams face on a daily basis.
I hope you understand in advance that this content may not be of much interest to those not involved in business.
Please be aware that this column is written with a relatively high level of passion, so it is likely quite long. Also, since it contains a lot of subjective content, it would be helpful if you could read it lightly, thinking, "So this is what this guy thinks..."
And if you feel like it, I would be happy if you could leave a comment or send me a DM. I intend to reply to each one carefully.
Furthermore, since I have spent many years in the logistics industry, I would like to inform you in advance that the content tends to lean towards logistics.
Now, please go ahead.
What is a service?
Many presidents of transportation companies say, "Transportation is a service industry."
And they are (apparently) trying to change their business model to a service industry. Today, I would like to verify whether thinking this way is correct.
What is the service industry?
What kind of business model is a "service industry"?
The result of asking ChatGPT is as follows.
The service industry is a job that provides services in response to customer requests and receives compensation. In a broad sense, any job that uses one's own skills or knowledge to provide some kind of value or joy to a customer falls under the service industry.
What is a service?
Then, what is a "service"?
I asked ChatGPT the same thing.
Service is a term that refers to support or assistance provided to others, or the benefits or functions provided in that process.
Can the transportation industry be a service industry?
Characteristics of services in business
According to Kotler, the characteristics of services in business are as follows.
・Simultaneity: No physical product remains after buying and selling, and it is consumed at the same time as it is produced.
・Inseparability: It is impossible to separate production and consumption.
・Heterogeneity: Quality is not constant.
・Intangibility: It cannot be touched. Because it has no form, it cannot be seen or tried before purchasing the product.
・Perishability: Because it is intangible, it cannot be stocked as inventory.
Where the transportation industry can be called a service industry
Indeed, since transportation is an "act" of moving cargo, it satisfies all the conditions of simultaneity, inseparability, heterogeneity, intangibility, and perishability. And in the sense of "using one's own skills or knowledge to provide some kind of value or joy to a customer," one must say that transportation (the act of transporting) is a service industry.
Points of differentiation from other companies
In that case, in the service industry, the points of differentiation from other companies would be to pursue three things: how far to bring heterogeneity closer to homogeneity, making something intangible visible or trialable before purchase (just like a tangible object), and shortening the lead time until the delivery of the output (instead of being able to stock it).
Things to be careful about
First, as a major premise, "simultaneity and inseparability" cannot be changed. So if you focus your efforts here, you will end up making futile efforts.
And, unlike digital services, transportation services are provided by "people," so if you force things like bringing heterogeneity closer to homogeneity or shortening lead times too much, it could lead to acts that violate the Labor Standards Act or the Subcontract Act.
Afterword
Thank you for reading until the end.
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