Business services are those activities that provide organizations with benefits without delivering physical products. They include banking, warehousing, marketing and inter-departmental communication.
The value of a service is usually intangible, and can be difficult to measure. It often involves multiple stakeholders and their inputs affect cost and quality.
Unlike product businesses, where a customer can simply purchase the physical goods they want, service-oriented companies often have customers who must be involved in the entire process from conception to completion. They are also more vulnerable to competitive threats.
A service business must build a reputation that differentiates it from other providers in the market. This can be difficult, but it’s crucial for a service company to succeed.
There are three major types of business services: business-to-business, social and business-to-consumer. All three help other companies or individuals achieve their goals, operate their businesses more efficiently, and reduce costs.
For example, a tech support specialist helps troubleshoot technology problems that occur at home or work. Similarly, a pest exterminator or maintenance professional addresses property issues such as broken appliances and malfunctioning equipment.
In addition, a social service business benefits society by improving the lives of people. These businesses are typically funded through taxes and charitable organizations, but they can also raise funds from sales transactions to enhance their efforts.
Business services are a large part of most developed economies and new technologies have expanded their reach around the world. They are a major contributor to employment in many countries, but they still face a number of challenges and obstacles that make them less competitive than other industries.