Complement goods also commonly called complementary goods are usually used or consumed together with other goods. This product with substitute products usually has a striking difference. In the process of certain activities, there are good things in the form of goods and services that have value in buying and selling. Usually, you can find this product or item around your neighborhood. This item will be useful if you use it in conjunction with other items or a pair.
If you are a coffee shop businessperson, complimentary items such as sugar and coffee are an immediate need that must continue to be available simultaneously for the continuity of your coffee shop. To check coffee and sugar stocks quickly and accurately, use F&B software integrated with the inventory management system so that you can easily manage the supply of raw materials appropriately.
Table of Contents
- Definition of Complement is
- Difference between Complement Goods and Substitute Goods
- Complement Goods Characteristics
- Examples of Complement Goods
Definition of Complement is
Complementary goods are goods whose use function is related to other products or goods. According to Henricus W. Ismanthono in the book Dictionary of Popular Economic Terms (2006), complementary goods are types of complementary goods that will not function perfectly without other goods. Investopedia stated that complementary goods or complementary goods will not have their own consumption value without other goods. If you use it together with other items, the complementary item will have a higher value if you compare it to using the other item separately. When viewed from a market perspective, complementary products affect the demand for each other’s products in the market.
Use Supply Chain Management Software to manage products and materials accurately.
Difference between Complement Goods and Substitute Goods
In contrast to complementary goods, substitute goods are goods that are substitutes for other goods but still have the same function. Basic goods will not function optimally if there are no other items that make their functions run better. In terms of availability, complementary goods are very vulnerable to a decrease in function value if their partner is not available. This happens because complementary goods cannot be replaced. Basic goods for complementary goods cannot be replaced by other goods. So if the item is not available, there is no other alternative item that can be used. Substitute goods have a function as substitute goods. If a substitute item is not available, a replacement item will be available. From a dependency point of view, Complementary goods are highly dependent on the object being complemented. Meanwhile, substitute goods are not dependent on other goods.
Complement Goods Characteristics
Later, the characteristics of these complement goods can distinguish complementary goods from substitute goods. The following are the characteristics in question:
Two items in pairs
Complementary goods must have a functional relationship with other goods. Therefore, complementary products are also often referred to as paired goods. If product A is dependent on product B, product A is a complementary product. Without a partner, complementary products can still function properly.
Complementary goods have little value
The value of complementary goods is less than that of other goods. Even the value of this item is not the same as everyday items that do not fall into this category. The value of the complementary product will increase with the product that is its partner. If this is the case, it means that complementary products have been used properly. This is also the reason why complementary products can affect demand in the market. Because if it can be used properly with its partner goods, the demand in the market will increase.
Cannot function by it self
Complementary goods can still function even without a pair of goods. Examples such as laptops and keyboards. Laptops are complementary goods. Even without a keyboard, the laptop can still function properly because there are tools attached to the laptop itself. It’s just that in today’s efficient and easy-to-use era, keyboards are still what people need for practicality.
In addition, you can use CRM-Sales to increase your business sales.
Examples of Complement Goods
Sugar and coffee
Sugar is a complementary necessity if you want to make coffee. Coffee will have a very bitter taste if you don’t add sugar to it. Therefore, sugar is a complementary item that is just a complement.
Gas and stove
The next complementary item is a stove. The stove will not function properly if there is no gas. Gas is a complementary item and a stove is a staple item. If the stove does not have gas, of course the stove becomes an item that is not of great value. Because without gas, the stove will not function to cook food.
Remote with battery
Batteries are complementary goods. Because, you won’t be able to use electronics or remotes without batteries. Therefore, the value of the remote will increase if it has batteries.
Ink and ballpoint pen
Ink is another example of a complementary good. Without ink, a ballpoint pen will not be as useful as it should be. Ink is a complementary item and stove is a staple item. Because without ink, a ballpoint pen cannot function for writing.
By knowing the explanation of complementary goods and substitute goods, you have added knowledge about the business world. Complementary goods and substitute goods have different functions. Every good and service in the environment relates to each other to help and complete your life. In addition, you can also use an ERP system that can help your company’s operations.
In developing business and company, HashMicro comes with many solutions for your various business needs. HashMicro is an ERP solution provider with the most complete software suite for various types of industries. ERP System is a system that can make your business operations more effective and efficient. HashMicro provides an ERP system that integrates directly with IoT so that you can monitor your business in real-time. You can also view all information from various parties only through the ERP system including supply chain, inventory management, and much more