Orange Goods
What are “orange goods”?
Orange goods are consumer goods that will be replaced at a moderate rate. Consumer goods, also called “final goods,” are items purchased by customers for use or consumption. Clothing is the classic example of an orange good because, though most clothes are fairly durable, clothing will be replaced at moderate intervals due to factors such as damage or changes in preferred style.
What are other categories of goods?
There are two categories of goods similar to orange goods, which vary primarily on how quickly the good must be replaced:
- Yellow goods are consumer goods that are nonconsumable and will be replaced at a slow rate. Yellow goods include household appliances such as refrigerators and dishwashers. Yellow goods generally have a high profit margin for manufacturers.
- Red goods are consumer goods that are consumed quickly and thus replaced quickly. The classic example of red goods are food products. Red goods also generally have a low profit margin for manufacturers.