Business services are activities that support the core business of an organization. They are intangible, do not produce a physical product and are a support function to the primary business activities of an organization. The sector includes a wide range of industries, including IT, architecture, engineering, legal services, advertising and marketing, employment, staffing and facilities management. Business services are an integral part of the economy, accounting for 11% of EU GDP.
The success of a service business depends on four things: the quality of customer experience, the speed of delivery, the availability of a network of suppliers and the involvement of customers in operational processes. In contrast to products, which can be stored and sold at a later date, services are often produced and consumed simultaneously. Consequently, services do not have the same level of consistency as physical goods. This is partly because of inconsistencies between the different people involved in a service production process (e.g., a teacher’s teaching style or the treatment of a patient by a doctor) and because of changes in demand and expectations, which may require adjustments to service provision.
In addition, because of the intangibility of business services, it is hard to quantify them and make them a tangible component of a company’s assets. As a result, companies are reluctant to invest in this area, compared with other sectors. Nevertheless, outsourcing business services has become increasingly popular in recent years. Among the benefits, this approach offers a great opportunity to improve efficiency and concentrate on core activities while reducing overhead costs.
Another advantage of outsourcing business services is that it helps to reduce risks associated with particular activities. For example, some activities may require specific skills that are not available within the company, or may be subject to a regulatory framework that is not familiar to the company. Outsourcing these activities allows the company to focus on its core competencies and leave business services to specialists.
Lastly, in times of economic crisis, customers may be less willing to spend money on services that they perceive as non-essential. As a result, it is important to communicate the value of a service and convince consumers that it is worth the investment. This can be done by highlighting its impact on customer productivity or quality of life, and by creating a brand image that distinguishes it from competitors.
Some examples of business services include design services such as a graphic design firm that produces logos, signs, packaging and publications for businesses. Utility services such as a solar panel installer that charges commercial clients based on energy consumption. And facility services such as a cleaning and maintenance provider for office spaces or warehouses. Business services are an integral part of numerous industries and a crucial aspect of any company’s operations. The intangible nature of these services makes them difficult to quantify, but they are still essential to the day-to-day running of any organisation.