Business Services

Business services are the activities that support the core business of an organization. Banking, insurance, warehousing, transportation and communication are examples of business services. They can also include services that are not directly related to the business, such as recreational facilities and education. These activities provide value to the organization and are essential for its success.

They are intangible, meaning they do not create a physical product. Because of this, they cannot be stored like inventory for use at a later time. This characteristic differentiates business services from goods, which can be stockpiled for future consumption. In addition, business services require the involvement of a customer. This can make them more challenging to manage because of their dynamic nature.

For example, a customer’s interaction with an architect might influence how well the building is designed or how efficiently the manufacturing process occurs. Similarly, a person who dithers at a fast food counter may slow down the service for everyone behind him or her.

In addition, many business services are outsourced and require special certificates, permits and authorizations that are difficult to obtain or maintain. This is a major challenge for companies and impedes their competitiveness.

However, the potential for growth in this sector is considerable. The EU’s internal market legislation and policy actions aim to remove barriers to business services, stimulate productivity and increase the competitiveness of the sector. As a result, it is becoming increasingly important to the European economy.

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