The services industry is experiencing new types of pressures that are changing businesses around the world. In this blog series, we will examine the six major pressures facing services firms today, their causes, and how you can successfully respond.
Pressure #3 - Ever-Increasing Competition
Businesses within the services industry are experiencing greater competition than ever. According to respondents in Mavenlink’s State of the Services Economy Report, 45% of respondents expect competition to increase in the coming year, remaining one of the top pressures in the industry. As competition rises, today’s services business must find new ways to continue succeeding in changing industry.
According to MarketResearch, there will be a projected 5.4% growth of the services industry between 2016 and 2020. We’re nearing the end of this projected period, which means businesses are now in a larger, more complicated, more competitive industry. As the services field expands and shifts, competition increases for everyone within the industry. There is no slowing for industry growth either. The Bureau of Labor Statistics reports that the 10 occupations with the largest projected growth between 2008 and 2018 are in the service sector.
What’s Causing This Pressure?
Steadily-rising competition is to be expected in every industry. However, the services industry has undergone a major spike in competition over the course of the last several years as the market expands, client expectations increase, and new forms of technology enable companies to provide new forms of services. In addition, businesses are broadening their range of services, pushing them into new markets.
As more organizations offer a greater range of services by leveraging contract workers and purchasing other businesses, the lines between sectors of the industry become more and more blurred. As a result, more companies become direct competitors with one another, rather than staying within their traditional markets and only in competition with their native companies. As more and more businesses broaden their offerings, competition steadily rises and diversifies, leading to the demand to do business in a different way.
Alleviating The Pressure
Increasing competition is the direct result of the industry changing. In response, businesses will need to become more flexible. Specifically, today’s most successful services businesses are broadening their offering, providing a wider variety of services in order to successfully secure a larger share of their return business. Improved client satisfaction combines with a broader range of services in this strategy.
Succeeding in the Modern Services Industry
Facing new and increased competition requires stronger teams. Utilizing your workforce more effectively and streamlining your business processes will help you counteract today’s evermore competitive industry.
Learn more in our ebook “The Rise of the Remote Worker in the Digital Age.”