Key Takeaways

  • Service businesses can also generate revenue through selling goods.
  • Examples of dual-model businesses include salons, auto repair shops, and coffee shops.
  • These hybrid businesses benefit from diversified income streams and enhanced customer experiences.
  • Understanding mixed-service and product-based models helps entrepreneurs better plan offerings and profitability.

Examples of service businesses include companies engaged in transport, food service, distribution, retail, and other industries that sell services rather than products. These intangibles provide the primary revenue source for service businesses.

Facts About the Service Industry

According to the U.S. Census Bureau, the following industries are part of the service sector:

  • Recreation
  • Arts and entertainment
  • Social assistance
  • Health care
  • Waste management
  • Professional and technical services
  • Scientific services
  • Transportation
  • Warehousing
  • Information services
  • Commodities and securities

Nations with a service economy are categorized as more economically advanced than those that primarily rely on agriculture or industry.

China, Australia, the UK, and the U.S. rank near the top of companies that primarily have a service-based economy. The U.S.-based Institute for Supply Management tracks business activity in the service industry on a monthly basis. Because more than 66 percent of the U.S. economy is service-based, this index provides a reliable indicator of the nation's overall economic health.

The CIA World Factbook and International Monetary Fund report the following service output rankings as of 2016:

  • India, $1 billion
  • Canada, $1.1 billion
  • Brazil, $1.3 billion
  • Italy, $1.4 billion
  • France, $1.9 billion
  • UK, $2.1 billion
  • Germany, $2.4 billion
  • Japan, $3.5 billion
  • China, $5.7 billion
  • U.S., $14.76 billion

Three-Sector Economy

In the three-sector economic theory, service is considered the third tier. Businesses that provide experiences, consultation, and/or advice all fall into this category. The primary sector is the agricultural, mining, and farming industries. The secondary sector includes the manufacture and sale of tangible products. Although service is considered tertiary, it is the largest economic sector in the U.S.

The knowledge economy is one of the most rapidly increasing facets of the service sector. This involves the use of data and technology to understand the needs of an audience and meet these needs as efficiently as possible.

Service Business Ideas

The service industry provides numerous opportunities for small business owners.

  • Mobile pet grooming requires a van, the right tools, and experience. If you have what it takes, you'll be able to create a clientele that appreciates the convenience of your service.
  • Collectibles resale is a great choice for those who love to shop secondhand. Scour yard sales, consignment stores, and online markets for antique and vintage items to resell on eBay and in hobby magazines. To boost success, specialize in a niche, whether it's old-school concert T-shirts or classic toys.
  • Diaper delivery creates a user-friendly experience for parents who want to minimize their environmental impact by opting for cloth diapers. If you have a delivery truck and access to a washer and dryer, this is your chance to start a green business.
  • Dry-cleaning pick-up and delivery provides a service for professionals who don't have time to head to the cleaners. Partner with office buildings, train stations, and other convenient drop-off locations in your area. You might even be able to negotiate a special rate with the neighborhood dry cleaner.
  • Mobile locksmiths can find success with just a cell phone and a van if they possess the equipment and training. If you're a night owl who doesn't mind being on call 24/7, this could be a lucrative opportunity.
  • Graffiti cleaning services can be marketed to commercial and residential clients. If you're in an urban area where businesses are affected by tagging, offer to clean up their facades for a price.
  • Mobile golf club cleaning is a good choice if you live in a well-to-do area populated by the career-minded. Golf clubs can be expensive, so pitch regular cleaning to ward off discoloration, rust, and other issues that can affect their game.
  • Self-defense instructors can provide private or group classes in karate or their discipline of choice. This is a helpful service for customers of all backgrounds and across the lifespan.
  • Tour guide services can bring in the bucks if you live in a place where people vacation. Whether you know all the best nightlife spots in your city or you want to share your love of hiking with others, make it into a business by advertising your services.
  • Pet-sitting services range from daily dog walking to house-sitting for pet parents who are out of town. If you love animals, market your services to your friends and neighbors.
  • If you have a massage therapy license, take your show on the road by marketing mobile massages. You can specialize in bachelorette parties, baby showers, and girls' nights in.

Mixed Service and Product Business Models

Some businesses operate in a hybrid model, offering both services and physical goods. These businesses not only meet customer needs through expertise or labor but also through tangible products that support or complement the service.

Here are several strong examples:

  • Beauty Salons: Salons provide services such as haircuts, styling, and treatments while selling retail products like shampoo, conditioner, and styling tools.
  • Auto Repair Shops: These businesses offer repair and maintenance services and sell parts such as tires, oil filters, and batteries.
  • Coffee Shops: While primarily service-based (providing prepared food and beverages), many also sell packaged coffee beans, mugs, and branded merchandise.
  • Pet Groomers: These service providers offer grooming and bathing while selling pet shampoos, brushes, and treats.
  • Florists: A florist shop offers the service of flower arrangement and delivery, but also sells vases, cards, and gifts.
  • Bakeries: While selling baked goods is the core product, some also provide catering services or custom cake design consultations.

These businesses answer the common search query: "give 1 example of a business that render a service and also sells goods"—and more. Their dual focus allows them to diversify revenue streams, build brand loyalty, and enhance customer convenience by bundling value-added goods with expert services.

Frequently Asked Questions

1. What is a service business? A service business provides intangible value through labor, expertise, or convenience rather than physical products.

2. Can a business both sell goods and offer services? Yes. Many businesses operate under a hybrid model, offering complementary goods alongside services.

3. Why would a business want to sell both goods and services? Combining services and goods can increase revenue, deepen customer relationships, and create additional upsell opportunities.

4. How do I start a business that offers both? Start by identifying a service you can provide, then determine what products complement that service and meet legal and licensing requirements.

5. Where can I find legal help for setting up a service-based business? You can post your legal needs on UpCounsel’s marketplace to connect with experienced business attorneys.

If you need help with your service business, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.