The manufacturing business involves the processing of raw materials, parts, and components into output using a mix of machinery, equipment, and labor. This term most commonly refers to industrial production, where inputs are converted into finished goods on a large scale.
Manufacturing generates added value by converting inputs into products to sell. The process can involve transformation, assembly, casting, or molding.
Examples are:
- Food and Drink
- Automotive
- Clothes
- Base metal
- Basic chemistry
Production involves low to high technology. The output is then sold to household consumers or other producers. Other producers use this output to produce other more complex products (such as aircraft and cars).
For large-scale businesses, production usually implements sophisticated manufacturing methods such as agile manufacturing, lean manufacturing, flexible manufacturing, just-in-time manufacturing, and mass customization.
Manufacturing businesses prefer locations with cheaper rent. Logistics costs are another consideration in choosing locations. And, generally, they cluster in an area (industrial estate). Another factor in determining a location is proximity to customers and raw materials.
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