Two places:
If you have never installed a Services-aware app, the menu will be mostly empty or only show macOS's built-in entries like "New Note With Selection" or "Show in Finder". This is why most people assume Services does nothing.
Services is macOS's built-in way of letting any app speak to any other app. When you install an app that registers Services, the actions show up in this menu everywhere, system-wide.
A few examples of what a Service might do when you click it:
The clever part is that the source app does not need to know anything about the destination app. You can write a Service in Shortcuts, an Automator workflow, or a real app, and it just appears in everyone's menu.
Open System Settings → Keyboard → Keyboard Shortcuts → Services. You will see a long list of every Service every app on your machine has registered, organised by category (Files, Internet, Messaging, Text, and so on).
Each Service has a checkbox (enable/disable it) and a shortcut field. Click the shortcut area and press a key combination, and now you can fire that Service from anywhere on your Mac. This is the trick that turns Services from "buried submenu" into "second clipboard".
Services has been in macOS since the very first version. It was inherited from NeXTSTEP in the late 1980s, which is also where the Cocoa framework, plist files, and most of what makes a Mac feel like a Mac came from. The original idea was that apps should be small and composable, and Services was the wire that connected them.
The idea aged well. Long before "shortcuts" or "intents" were a thing on phones, Macs were quietly doing the same thing through Services.
A fast text toolbox on iPhone, iPad, and Mac. The Mac version registers Services for JSON, regex, case conversion, and more. · iPhone, iPad & Mac