Research is vital for service industries which can be explained by the ever-changing character of business situation in this market. Without sufficient business research, it is impossible for commercial organizations to determine which products and services will be important for their potential customers during particular period. Overall, research can be seen as an important variable in service industries helping companies’ management develop their business strategies, and keeping high levels of profits.
Research or business research can be identified as a vital managerial activity exercised with a purpose of defining the products and services which will be most profitable for the company and will be in demand among the company’s potential customers. The following comment identifies the importance of research for a commercial organization:
Organizations use research, especially in market research activities. Market research is used to identify potential markets, the needs and wants of each, how those needs and wants can be met, how products and services could be packaged to be most accessible to customers and clients, the best pricing for those products and services, who the competitors are and how best to complete against each, potential collaborators and how to collaborate with each (Basic Business, 2012, para. 8).
There are a few important components in business research including financial analysis, product analysis, growth analysis, and competitor analysis (Castillo, Paton, & Barroeta, 2012). All of these components are central in determining future business strategy for any commercial organization.
Just as any other commercial organization, a company working in service industry should make regular business researches in order to identify the state of affairs in the spheres of its activity during particular period of time (Shumei, & Huiyuan, 2012). Thus, there exists a close connection between service industries and research. In fact, the situation in service industries is one of the most complicated among the other business areas. This can be explained by the abundance of external factors affecting the business climate in service industries. Among such external factors are loss control considerations, political shifts, new or modified legislation regulations and policies, commodity prices, global economic conditions, technology changes, and even natural disasters. Average citizens who form demand in service industries are subjected to the effects of the widest scope of complicated circumstances and difficulties (BURKE, & RAU, 2010). As a result, it often happens that during months people do not demonstrate their willingness to make any business settlement with enterprises. For example, when after the economical crisis of 2008, people’s income significantly decreased, travelling industry began suffering great financial losses (Bhandari & Copeland, 2011). After 2008, a few years passed before people returned to their normal practices during vocation periods. This left its trace on the functioning of the majority of travelling companies. In such conditions, company management had to perform a lot of business research with a purpose of identifying those areas which could be still advantageous in tourism industry.
In conclusion, it should be stated that there exists a close connection between research and the functioning of commercial organization working in service industries. Without research, companies’ management is not able to determine further strategies for effective operating and future growth. In addition, the state of affairs in service industries is subjected to the influence of an abundance of external factors such as political shifts, new or modified legislation regulations and policies, global economic conditions, technology changes, and even natural disasters. This constantly affects companies’ business strategies as they have to adapt to the ever-changing conditions in the market they work.
References
Basic Business Research Methods. (2012). Web.
Bhandari, R., & Copeland, J. (2011). Services In Context. Journal Of Advertising Research, 5(1),148-152.
BURKE, L. A., & RAU, B. (2010). The Research-Teaching Gap in Management. Academy Of Management Learning & Education, 9(1), 132-143.
Castillo, J., Paton, J., & Barroeta, B. (2012). Research, Development and Innovation Impact in Services and Industry. China-USA Business Review, 11(5), 697-708.
Shumei, W., & Huiyuan, M. (2012). The Strategy Research of Modern Service Industry Development. Asian Social Science, 8(2), 185-188