Business services are the non-financial services provided by businesses to other organizations. These include travel and facilities services, security, waste management, and staffing.
Service businesses are often considered a less competitive business than other types of companies, because their offerings may not require much initial capital investment and have low barriers to entry. Moreover, they can be run from a variety of locations, including offices and homes.
Unlike goods, services do not have physical forms and cannot be touched or seen. They are intangible and must be experienced by a customer to be valued. Examples of these intangible products include teaching by teachers, the doctor’s treatment to patients and so on.
The intangibility of services makes them hard to measure and compare. Because of this, service companies need to create a strong brand image and make their offerings desirable.
Intangibility also means that services are often priced based on value rather than cost. This is because customers will pay whatever they think the service is worth.
During times of economic recession, consumers typically cut back on services. This can create opportunities for service companies to increase their revenue. By focusing on what customers want, they can increase the perceived value of their offering and compete with less appealing competitors. They can also focus on the customer experience to make their services more attractive. This means offering convenient hours, proximity to customers’ homes or offices, and more scope. It can also mean offering lower prices than their competition.