Business services are the work that an organization performs to maintain a business. These services do not produce or sell a tangible product like goods, but they are required for the survival of the company. Examples of business services include information technology (IT), procurement, finance, shipping, and many others.
Differences Between Goods and Services
The main differences between goods and services are their intangibility, inconsistency, and inseparability. The intangibility of services means that they can only be practiced instead of being produced, and their inconsistency means that each service must be performed exclusively every time. In contrast, products can be stored for later use, and they can be reproduced to meet demand or supply at different times.
Intangibility of Services
The intangibility of services is the biggest difference between services and goods. While goods can be produced at any time, services must be delivered when requested by a customer. This is a key distinction because it means that services are non-transferable, as opposed to products.
Inconsistency of Services
One of the most important factors in a successful business is its ability to provide services that meet the needs of an attractive group of customers. That’s why managers of service businesses must pay attention to the design of their offerings.
A service designer must understand the experience that customers want to have with a given offering, and they must consider the experiences their competitors offer as well. They must be able to deliver these experiences in ways that distinguish their offerings from those of the competition.
In addition, a service designer must be able to make customers feel comfortable when they visit their services. They must know what to do to create a welcoming environment, and they must be able to communicate their values to their employees and customers.
Intangibility of Products
There are some differences between products and services, but most products fall somewhere between the two. For example, a restaurant provides food and drinks, but it also provides other services, such as atmosphere, setting and clearing the table, etc.
Some products are primarily services, such as telephones and electric meters. Then there are products that combine elements of both services and goods, such as airplanes.
Similarly, some products are predominantly goods, such as cars and refrigerators. Some products are both services and goods, such as televisions and water heaters.
The main reason for the existence of business services is that a company must do some work that does not fall within its expertise, but it must be done. Hence, it turns to companies that specialize in providing those specific services. This way, it can free up its resources for strategic-based internal goals while still ensuring that those jobs are performed to the best of their abilities.