Define Service Provision

Written by mark bingaman
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A service provision -- in the business world -- is the delivery of a non-material good. It cannot be seen, handled or stored. It is a collection of special skills, intellectual property and talents offered for sale.

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Identification

A lawyer provides a service -- thus, a service provision -- when she advises a client on a legal issue. This is the result of her experience and training in the law. Conversely, a farmer selling apples at an open market is not undertaking a service provision. The apples are physical objects.

Benefits

Unless under special contract, a service provision remains the property of the provider even when the service is paid for. He is allowed to offer the service to others on the free market. This is an advantage for a business as no stock or inventory need be carried or stored. However, marketing of the service is crucial as intangible objects and services, in some instances, can be difficult to sell.

Considerations

In some instances, a service provision may be included with a transaction where a product also was provided. For example, a computer company may sell a tangible object like a computer for a particular price, then offer the service provision of its knowledge and expertise in the form of technical support for an additional payment

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