Consumer goods are alternately called final goods, and the second term makes more sense in understanding the concept. Essentially, these goods are things purchased by average customers, and will be consumed or used right away. This is in contrast to other types of goods, called intermediate goods. Intermediate goods are products produced or things sold that will be used in the making of something else by another manufacturer or an assembler. Fabric produced from cotton might be an intermediate good, for example, while the clothing made from the fabric would be a consumer good, since it has reached its final destination: the consumer.
The category is most important in assessment of gross domestic product (GDP), basically a yearly measurement of what is purchased (consumed), made, invested, and what is spent by the government. Economic analysts can parse out the different types of goods that are included in the GDP, and look at how each area is performing. So for instance, a decline in consumer sales would indicate people aren’t spending as much on consumer items, which can include on food, automobiles, clothing, electronics, and a host of other things.
Some things that would seem like consumer goods are not traditionally classed this way. For instance, most things sold secondhand aren’t included any longer because they were already counted as final goods earlier. This would include the resale of items like cars, clothing, or jewelry. Other things that individuals might purchase like tires or a car battery, aren’t final goods either. Technically, the parts used in the assembly of cars don’t represent a final product, even though many people have had to buy new tires for a car or replace a car’s battery, because they may be used in the production of new items.
There’s also a classification called Fast Moving Consumer Goods (FMCG) or Consumer Packaged Goods. These are items that will be sold very quickly, such as most items sold in grocery stores and many small electronics items. Such things don’t always sell quickly, but they are usually consumed quite fast, and are defined the way they are in contrast to what are called durable goods, like big appliances. Simply put, a jar of strawberry jam, an FMCG, will be consumed much more quickly than the refrigerator a shopper places it in, a durable good.
Another group of final goods is called Fast Moving Consumer Electronics (FMCE). This includes items like cameras, cellphones, MP3 players, and laptop computers. Desktop computers may be more likely to be considered as durable goods, though they’re still final goods, because they tend to stay in use longer than the average laptop.
