service based companies

What Are Service Based Companies? Everything You Need to Know

Hey, Today we are covering the topic which is alternative to my last article. As you know there are two types of companies first is Product based companies and second is Service based companies. I have written about Product based companies in briefly. If you haven’t read it yet, go and read it first. Today we are talking about service based companies. Read this article carefully if you want to know every thing about it.

What Are Service based companies?

The company which works for client as per their requirements is called Service based company. Suppose there is a bank and bank need the specific designated website or software to manage their customers. They hire a service based company and tell them their requirement. If the company agree with them, they sign an agreement with company. They create a team and start to work for them.

Difference between Product and Service based companies

As I have told these both companies work on inverse manner. Product based companies earn money by selling their owned products. On the other hand Service based companies provide their service for particular business.

Revenue Difference

This is not the exact data. Keep this in your mind as an example. Let suppose the difference between revenue details –

P. Based CompanyS. Based Company
Revenue in 2020$2.5 Billion$23 Billion
Employee7600448464
Revenue/Employee$3,28,947/Employee$51,286/Employee

As you can see how many difference between revenue of an Product based company and an Service based company. The revenue of one employee of Product based company is about 6 time more than Service based company.

Work Environment Difference

Keep this following table in your mind when looking for the difference between product and service based companies. All important things are included in it as follows –

Product Based Service Based
Small teamsLarge teams
Employee from good collegesEmployee from average colleges
Chill LifeRegulated Life
Friendly EnvironmentCompetitive Environment
Ownership of workWork is assigned to you
No dress codeWear formals
Latest technologies Old technologies
Now deadline for complete workDeadline for complete work

You can give suggestions to your seniors to put more improvement in the product while working in Product based company. On the other hand you can not will to do any changes in work because you were working for others while working in Service based company. You get lunch and snacks for free while Product based company. You never get lunch and snacks in Service based company.

Learning Difference

If you join P. based company they directly give work to you. It means you have to learn yourself. If some of them companies giving training, the training is not satisfied. Inversely if you are working in a Service based company, the training is very high level’s. As you can see I have mentioned all important factors of learning difference between both companies in the following table.

Product Based Service Based
Training is not goodExcellent training
Good Projects Varies quality Project
Mentors are helpful and knowledgeable No mentor concept, you have to learn from people around you
Development ProjectsMaintenance and support projects

In P. based company, they have fixed you on one type of work. Inversely S. based company, they keep changes on your roll in different projects. Example – In your last working month you worked as a front end developer and now you got the work as a back end developer. Here mentors are available to help you in product based but not in service based. Because they have provided good training to you before joining the company in service based. As you know P. based company have their products. They try to keep updated it. Therefore they tell their employee to develop it time to time. In S. based company you have to create project for others. Therefore you got work for maintain it.

Salary Difference

As you can see the difference between salaries of both types of companies is as follows –

Product BasedService Based
High Package Low Package
Slow growthFast growth
Low competition High competition
No on-site chancesOn-site chances

Now talking about Salary. In the table you can see salary is more in Product based company in comparison to Service based company. For example – Google will pay you more than TCS Now think about promotions – In Product based company you will get slow promotion because they have less projects. In service based company you will get fast promotion. Because every person who work in companies willing to do job in product based company. Therefore the employee of S. based company leave their jobs when they got offer from P. based company. The juniors become seniors fast.

Working Time Difference

As you can see the difference between Working time of both types of companies is as follows –

Product BasedService Based
FlexibleStrict timing
Work from homeRarely work from home
Extra money if you come on weekendsNo extra money on any conditions
No night shiftsNight shifts

In P. based company you easily get work that you can complete at your home but there is rare chances to get work for home. This is compulsion to come to office to do work. Obviously they will pay you extra if you do extra work in P. based. In S. based they won’t pay you extra because there is fixed work for you.

Is it good to job in Service based companies

There are some conditions to go ahead for Service based company –

  • You are not from computer background and not good in coding
  • Good communication skill
  • If you need guidance
  • Complete work in deadline
  • Multi domain work

Is there any job security in Service based companies

There are low chances of job security. But don’t worry they won’t kick you. There are many people who are working for company from ten years. If you are not working good, they will keep you on bench. Bench means the condition where they consider you as substitute. If you did not get work for 6 month, there are dark chances that they will kick you from job. Job security is more in Service based companies as comparison to P. based companies.

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