Business services are intangible products that a company sells to help businesses focus on core activities, increase revenue, reduce costs and improve efficiency. They are often categorized by function and include everything from IT consulting to legal advice, marketing, communications and insurance services.
The industry that offers these services has a wide range of clients and includes companies that provide consulting, IT outsourcing, training services, and logistics (including travel, shipping, facilities management, waste handling, staffing, and security). This type of business is typically more flexible than product-based businesses as it requires less start-up capital since it doesn’t involve the purchase or manufacture of physical items. However, it’s essential to be prepared for the challenges of a service-based business by conducting thorough research, creating a solid business plan, and prioritizing excellent customer service.
Generally speaking, a service-based business will engage in a detailed consultation process with each client before providing any actual work to ensure that they fully understand the project’s scope and are on the same page. In addition, a service-based business will also frequently meet with clients to communicate expectations, identify SLAs, and sign non-disclosure agreements.
As a result of increased affluence, the need for certain services has grown. As an example, home owners have more leisure time and are increasingly hiring companies to take care of chores like landscaping and cleaning. Similarly, the rise in working mothers has created a demand for child-care and housekeeping services. Additionally, many businesses are now outsourcing their IT services to other firms because of the cost-efficiencies involved.