Business services are those activities, other than the main business activity, which support it. These can include banking, insurance, IT facilities and communication. Business service providers typically have specialized expertise and knowledge that can improve productivity by eliminating non-value added tasks and freeing up time for employees to focus on value adding activities. The services also provide a way to deliver a more consistent experience for customers and clients. In addition, they can be scalable to meet demand and increase profitability.
Unlike goods, which can be produced and stored to be consumed at a later date, production and consumption of business services are simultaneous. This is because the customer interacts with the provider during the service delivery process, which can affect the quality of the service experience. Another key difference is that a service cannot be stocked like a good can, so it has to be delivered when required.
As a result of these differences, business services have different characteristics than other sectors of the economy. For example, they tend to have higher profit margins and a more diversified revenue stream than other sectors, such as manufacturing and wholesale/retail trade.
However, despite their high margins and diverse revenue streams, there are some challenges to the sector, including relatively low productivity and persistent legal barriers. EU Internal Market legislation and policy actions aim to remove these obstacles and stimulate competitiveness in the sector.
The emergence of business services has changed the way we think about the economy. While goods are the traditional focus of commerce, more and more attention is being placed on delivering value to customers through new combinations of goods and services. This approach is referred to as ‘serviceitisation’.
While goods and services are different, they have many commonalities, including their role in transforming the economy. The growing importance of business services is one of the reasons for the rapid economic growth in Europe and elsewhere.
There are a variety of opportunities to start and grow a business providing business services. They range from professional services such as marketing, legal and IT to warehousing, distribution and communications. The demand for business services is increasing as a growing number of companies outsource some or all of their non-core functions.
Whether you are looking to hire or become employed in the field, there is a place for everyone in the world of business services. Some positions require nothing more than a high school diploma or GED certificate, while others may require a bachelor’s degree. In order to find the right job for you, it is important to understand the nuances of business services. This will help you decide which sector of this vast industry is the best fit for your skills and qualifications.