Business services-its characteristics and types

Business services are intangible in nature and the service sector provides a good infrastructure for smoothening all business activities.

Meaning of Business services:

Business services are those which are connected with Banking, transport, warehousing, Insurance communication etc. and are helpful for the smooth running of the businesses.

Provide financial services by the banks to the customers, deliver goods by a retail store, Provide knowledge about the product to the customers are the best examples of business services.

The service sector is growing very fast in the Indian economy than in agriculture and industry.

Characteristics of Business services:

Characteristics of business services are explained as follows:

1. Heterogeneous:

Services are different according to the expectations of the customers. These services are also different in different sectors. For example public sector services and private sector services. These sectors perform their functions according to the rules and regulations set by the top authorities.

2. Inventory:

Services are not stored like goods or material. These are perishable in nature. These services are given to the customers in present, not saved for the future. For example cinema tickets, bus tickets etc.

3. Inseparability:

Services cannot be separated from the service provider. In this case, the service provider gives services to its customers at the same time and place.

For example, Lawyer, Chartered Accountant, Teacher, Doctor are service providers and their services are inseparable.

4. Involvement of customers:

Customers are necessary to avail the services given by the service provider. For example, the communication sector or telecom sector provide services but to use these services customer has to receive the call.

If customers will not take interest in the service then this sector can suffer loss. So customers are the roots of every business without customer involvement no business can survive.

5. Intangible:

 An individual can only experience the services. These services cannot be seen or touched by individuals that’s why these are called intangible.

Classification of services:

These are classified into three categories:

1. Business services: 

These services are used by business organisations to run their business activities more smoothly.

For example Banking, Insurance, Transportation, Telecom Industry.

2. Social services: 

Social services are carried voluntarily to achieve the social goals to improve the standard of living of the weaker section of the society.

For example Education sectors, Health sectors.

3. Personal services:

These services are different according to the different service providers because these are given as per the demand and preferences of the customers.

For example Restaurants, Salons, Tourism.

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Also, Check our Tutorial on the following subjects: 

1. 1. https://tutorstips.com/financial-accounting/
   2. https://tutorstips.com/advanced-financial-accounting-tutorial