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Tertiary Sector

The tertiary sector, whose services are sold in consumer, capital, industrial and service markets, forms a major part of most developed economies (such as the UK Italy and France). In recent decades the tertiary sector has increased in importance for many developed economies. In the UK the tertiary sector is by far the biggest proportion of the economy. Operating in the tertiary sector poses similar problems to that of the secondary sector: they still need to “Add Value” to their products and they still face competition. Yet because a good deal of service sector business requires “face to face” contact with the customer, it is a little harder for overseas competition to take customers away. More significant is the idea that much of the service sector is based on the “knowledge economy” i.e. that knowledge and information is worth money and those who posses it have the upper hand.

Increasingly service sector businesses need to focus on this idea of the “knowledge economy”. They need to keep ahead of competitors by understanding what it is their customers want and be in a position to deliver this quickly and efficiently.

One good example of this is the Banking industry which has gone through enormous changes in recent years. Using information and communication technology, banks have vastly reduced the number of staff they need. Many banks and building societies have merged to form much “leaner” businesses capable of extracting more profit from a wider customer base. The key to this process is gaining information about their customers and constantly communicating new products to them. Opening a bank account is guaranteed to increase your junk mail!

Click on the following links to find out more about UK tertiary sector businesses:

In each case, make notes on the following issues:

  1. Which markets did/do each company operate in?
  2. What made/makes the company successful or unsuccessful?
  3. What problems do you think each company might face in the future?