Business Services

Business services are the actions/activities that assist a business but do not involve the delivery of tangible products. They include consulting, logistics, waste management, staffing, shipping and administration. They are a major part of the economy and provide support for other sectors such as manufacturing.

They are also increasingly being used to add value to products through new combinations of goods and services. This is often referred to as ‘servitisation’. Business services are very important to European competitiveness and contribute 11% of the EU GDP. The sector provides a wide range of jobs and represents an opportunity for the growth of Europe’s economy.

In economic theory, service falls into the third sector, or tertiary sector, which includes activities that offer experiences and advice, but do not create a physical good. It is contrasted with the primary sector, which comprises activities that harvest and transform raw materials, and the secondary sector, which involves the manufacture of physical goods.

Most modern businesses combine elements of both services and commodity goods, a mix that is sometimes called ‘commodity services’. For example, a restaurant offers food as a commodity good, but it also provides services such as ambience and service. Utilities are another example, as they deliver a physical service (water) but are usually considered to be part of the service industry.

Almost all businesses require some form of business services. Insurance services, for example, are a necessary part of any company, as they reduce the risk of financial loss due to damage or theft of goods. Moreover, companies also need real estate services to rent or purchase workspace and landscaping services to maintain their workplaces.

There are many benefits to using business services, the most obvious being that they save time and money. By outsourcing these tasks to outside providers, companies can free up their internal resources and focus on more strategic-based goals. Additionally, by working with a business service provider, companies can tap into expertise and experience that may not be available within their organization.

When times are tough, however, consumers tend to cut back on non-essential services. This can be seen in the decrease in car service use during economic downturns, as well as the increase in people doing their own yard work rather than hiring a landscaper. Despite this, it is still important for businesses to provide quality services to their customers so they can stay relevant and competitive in the market. By focusing on the four critical elements of service design, companies can ensure their success in this dynamic industry.