Business services are activities that benefit companies without delivering a physical product. These include marketing, production, safety, cost and convenience services. These activities can also help improve company productivity, efficiency and overall performance. They are provided by companies that specialize in providing such services. They are a significant part of the European economy and contribute to 11% of GDP.
They are categorized as tertiary and support the primary and secondary sectors in an economy. They are not the same as economic services, which are a subset of business services. For example, education and healthcare are classified as economic services while hospitality falls under business services.
Examples of business services include IT services, telecommunications, management and other professional services. These services are valuable, intangible and cannot be stored for later use. They are based on customer demand and have to be produced at the same time as they are consumed. This means that the quality of business services is always a factor in determining how successful a service is.
Other important business services include the ability to provide warehousing, inventory management and order fulfillment. This allows businesses to focus on their core competencies and maximize the utilization of their workforce. This can save a lot of money by allowing companies to outsource the work that doesn’t fall within their expertise. In addition, these services can be scaled up or down depending on the needs of the company. For instance, if the company is experiencing seasonal output fluctuations, they can hire additional workers.