The business service industry encompasses a huge portion of the commercial world. In general, a business service helps businesses do what they can’t or don’t want to do themselves. That includes things like advertising, consultation, logistics (including travel and facilities services), staffing, shipping and administration services. Every firm in operation needs these kinds of services.

The success or failure of a business service comes down to four things: the right people, the right equipment, the right environment and the right strategy. To excel, managers need to understand and master these four elements.

To help businesses meet demand, some business services provide value-added functions that reduce the time it takes for firms to get products into their customers’ hands. For example, warehousing services can include sorting bulk goods into customized lots, packing and labeling, performing light assembly and marking prices. This improves the efficiency of relationships between manufacturers and distributors, which in turn helps firms compete with their competitors.

In many pure service businesses, a concrete product isn’t produced or transferred to the customer. Examples of these kinds of services are airlines, computer service bureaus, law firms and management consulting firms. These companies must develop their operations based on an understanding of what their customers truly value. To do this, they must be able to articulate their offerings in terms of the experiences that their customers desire and create ways for their customers to compare those experience to their competitors.