Service Business vs. Product | What Are The Challenges?

In the next few months I’m going to be talking a little bit more on what it takes to create a successful business in addition to my normal tips and insights….Let me know what you think in the comment section!

I think owning a service business comes with its own set of challenges.  Our revenues are dictated by time and people instead of units and products.  For us who charge by the hour, because we can’t add more hours to the day, this means we can only grow by adding staff and increasing the number of people serviced. This comes with its own set of challenges, every time you add additional staff, your overhead increases.  You will then need additional space, supplies and increased personnel costs.  This compared to a product driven model, where if the demand increases you just increase production.  The cost of that increase in production can be factored into the price of the product.


The other difference between a service business and a product driven model, is relationships.  A service business is built on the direct interactions it has with its customers.  Those relationships can make or break the business.  Word of mouth and referrals are the main drivers in sustaining a repeat clientele.  With out that referral stream the cost to constantly generate new clientele would absorb any profits gained. With a product based business; exposure, presentation, need and functionality are the main drivers of sales.  With a product the customer sees it, wants it and buys it.  The guy in the back that is putting it together doesn’t matter.  With a service it is all about the guy in the back!


So the way you create a successful service business is focus on your relationships!  This starts from the first point of contact.  This can be the person on the other side of the phone when they call or how you interact with a potential new client when you meet them in the grocery store.  Professionalism and compassion must be conveyed at all times.  The customer experience is key!  If they are led through the entire process with a white glove and a soft shoulder you will have them for life.  So what do I mean by a soft shoulder?  Humans like to feel wanted and listened to. Make the customer feel like they are the only person in the world and do this with genuine intentions.  If you follow these rules you will be amazed at the results.  Your concern and quality service will differentiate you from the rest of the crowd.

Author: Holden Zalma

Healer and founder of MetaTouch Therapeutic Massage and Wellness center

Skip to content