Business services refer to the types of help that businesses need in order to operate. They include banking, warehousing, marketing, inter and intra-departmental communication, etc. As the name implies, they are distinct from economic services, which focus on building and managing service systems, and consumer services, which involve interaction between a service provider and a service user.
The most obvious distinction is that, unlike goods, services cannot be stored and must be delivered when demanded. Moreover, there is generally direct customer involvement in the process of providing a service: for example, an architect who communicates well with his client will produce a more efficient design than one who doesn’t; or a person who dithers at a fast-food counter makes the entire line less efficient.
A business can save money by outsourcing certain tasks, such as a marketing consultancy. In addition, it can reduce the burden on its employees by freeing them to concentrate on value-added activities. This can be especially helpful if the organization is experiencing seasonal output fluctuations.
The business services industry is not without its challenges. For example, in developing countries, there are often obstacles to international trade that hinder competitiveness. To address these issues, the European Union (EU) has devoted significant attention to this sector with policy initiatives such as its Services DirectiveEN*** and An Integrated Industrial Policy for the Globalisation EraEN***. It has also created a High Level Group on Business ServicesEN***. The EU also supports the creation of a global network of business services centres, which are intended to help foster growth and innovation.