Business services refer to all activities that support a business yet do not produce or deliver a physical product. Examples of business services include information technology, accounting and marketing. Many companies that do not have the resources to provide certain business services in-house hire firms that specialize in those services. These firms can help with such tasks as building a website, developing marketing strategies, advertising products and promoting their brand. Many of these firms offer their services at a cost that is much less than hiring an internal department to perform the same duties.
One of the primary characteristics of business services is that they are intangible, meaning that they cannot be stockpiled for future use. This is in contrast to goods, which can be stored for later delivery or resold to another party. Another important characteristic of business services is customer involvement. Customers can often play a role in the service provision process, which may lead to higher levels of satisfaction.
Business services are the lifeblood of most economies, contributing 11% of EU GDP. They are critical for European competitiveness and are increasingly being used to enhance the value of products through new combinations of goods and services. For example, in the banking sector, business services have been used to make cash management easier, while in the retail sector they are being used to improve customer experience. The development of new business models is enabling businesses to take advantage of the opportunities presented by this evolution.