Business services are activities that benefit a company but do not produce a tangible product. They include such functions as marketing, warehousing, customer service and employee training. In addition, they can include such things as computer and information technology services. Businesses rely on these services to improve productivity, lower costs and increase efficiency. The concept of business services has expanded as companies have embraced the notion of “products as a service,” where goods are combined with other products, or ‘services’ to create new product offerings.
The business services sector is one of the most important sectors in the European economy, representing 11% of EU GDP and a growing share of the global economic pie. It is becoming a key driver of innovation and is also driving significant structural changes in the economy, with traditional goods being increasingly combined with service components. This trend is called “servitisation.”
Service businesses typically distinguish themselves from their competition by focusing on the experience they provide customers. This involves providing high quality and consistent services that are adapted to the needs of the customer. In doing so, they aim to differentiate themselves in the marketplace by creating a unique brand identity. In many cases, this requires a substantial investment in human and other resources to make the difference.
In a world of increasing competition, service differentiation is more important than ever. Unlike physical goods, which can be easily copied by competitors, the quality and value of services cannot be readily replicated by another provider. Thus, the need to invest in building a strong brand identity becomes even more critical.
Moreover, the nature of services differs from those of goods in several other respects. Unlike goods, services are intangible and cannot be stored as inventory. Consequently, they can only be delivered when demanded. In addition, services usually involve the active participation of the client, who has a significant impact on the success of the service, whether positive or negative. For example, an architect’s ability to understand the customer’s needs determines how well the project will be executed; a customer who dithers at a fast-food counter affects the service speed for all those waiting behind him.
A wide range of services are classified as business services, including consulting services, property and equipment maintenance services, financial and accounting services, computer and information technology services, and warehousing and distribution services. Other services are more specialized, such as pest control services and janitorial and cleaning services.
Specialized business services can also include automated billing and mail processing services. They can also include promotional or documentation services, such as technical writing and editing, graphic design and digital imaging. The majority of business services, however, are more general in nature. GlobalEDGE has categorized them into the following groups: