Business Services Sector Industry Profile

The US business services sector consists of about 390,000 establishments (single-location companies or units of multi-location companies) with combined annual sales of about $570 billion. Major companies include staffing services providers Manpower and Kelly Services; facilities service companies ABM Industries and Rollins Inc; and solid waste handlers Waste Management and Republic Services. Other major companies in the sector include office administrative service firms such as Automatic Data Processing and Iron Mountain; ADT Security Services, and the travel division of American Express. The business services sector is highly fragmented: the 50 largest companies account for less than 25 percent of sector revenue.

Companies in the sector provide support services to businesses in a variety of industries and, in some cases, to households. Offerings include office administration, hiring and placing of personnel, document preparation and similar clerical services, travel planning, solicitation, collection, security and surveillance services, cleaning, landscaping, pest control, and waste disposal.

COMPETITIVE LANDSCAPE

Demand ultimately depends on the level of business spending, which is determined by the health of the overall economy. The profitability of individual companies depends on efficient operations and effective marketing. Large companies often enjoy economies of scale and can compete for large, national accounts. Small companies can compete by offering highly specialized services, or through superior customer service. The sector is labor-intensive: annual revenue per employee averages about $80,000. Business support activities are often undertaken in-house by establishments ...