Business services are activities that help a company but do not produce a tangible commodity. They include a wide variety of functions that are vital to any organization, such as IT support and HR assistance. These services are essential to a business’s operational success and productivity. In addition, they can also offer companies new opportunities to reach consumers and clients through innovative combinations of goods and services.
The services industry is large and active worldwide. It is often classified as either business to business or consumer to business (B2B or B2C). Its contributions to GDP are significant, especially in low-income countries. It is a core component of the economy in many countries, and it includes all sectors that provide value added to businesses, such as IT support, payroll services, accounting, warehousing, distribution and shipping.
A company may choose to outsource certain business-to-business services to save time and money. One such example is a construction company that contracts out the building of its new facility to reduce the need for the company to invest in expensive equipment or training. Other examples of business-to-business services are a legal firm that provides legal advice and an HR consulting company that assists with employee relations.
Unlike goods, which can be stored for later use, business services must be delivered when they are needed. This makes it important for the provider to understand how its service is valued by the consumer. For instance, a customer who dithers at a fast food counter can slow down the process for everyone else behind him.