Manufacturing Company (Concept, Types, Classification, Characteristics and Importance)

  • Jul 26, 2021
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The start of the Manufacturing company dates from the 16th and 7th centuries, in principle the manufacturing activity produced few things, basically manually, but after the advances and discoveries of the industrial Revolution, was incorporating some specialized machines, until reaching the large factories of the current industrial sector.

Since then, manufacturing companies have been established in locations close to their consumers. products, in order to lower distribution costs, although they are also usually close to the establishment of the workforce more economical, in this case to minimize production costs.

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In this article you will find:

Manufacturing Company Concept

A manufacturing company is a company that processes raw material until it becomes a finished product that it will offer in the market to the consumer, it is in charge of elaborating consumer goods, therefore, being manufacturers, the exclusively service and commercial sectors are excluded.

That is why this sector, whether artisanal or automated, is also known as a manufacturing or industrial sector, regardless of its size, the factor that identifies it is the transformation of the raw material in a finished product for final consumption or as work material for another factory.

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Manufacturing company

Types of Manufacturers

According to the way of transforming natural resources, manufacturing companies can be of three types:

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  • Basic Industries: they extract the raw material from nature, such as the mining or oil industries
  • Transformation Industries: they modify the raw material into a good for daily consumption, such as the textile or food industries
  • Manufacturing Industry: Its production process produces serial articles, such as the technology and computer industry

Classification of Manufacturing Companies

Manufacturers are usually classified according to the branch of the deal to which they dedicate themselves, examples of them are:

  • Producers of beverages and food, tobacco and its derivatives.
  • Producers of textiles, footwear and clothing, of lumber companies and their derivatives.
  • Printers, producers of paper, cardboard and derived products.
  • Oil companies, producers of plastic, chemicals, rubber and other petroleum derivatives.
  • Mining and basic metal processing companies.
  • Manufacturers of tools, machinery and equipment.

The classification can be quite long, as long as manufactured products can exist.

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Characteristics of the Manufacturers

The most emblematic characteristics that distinguish manufacturing companies of any other type are:

  • They constitute the secondary sector of the economy of any country.
  • They transform raw materials from the primary sector of the economy in finished articles.
  • Its production is marketed by the tertiary sector of the economy or by other sectors for the extraction of raw material or for its transformation into the production of a different product.
  • It is made up of SMEs or large multinational companies.
  • To transform raw materials into products requires the use of tools, machinery and labor or labor force.
  • Factory consumer products or secondary items for production.
  • It requires human talent trained for the manufacturing activity and for the administration of the company.

Importance of the manufacturing company

After knowing the most relevant aspects of manufacturing companies, it is indisputable to recognize their importance for any country since:

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  • They are a permanent source of job.
  • They produce goods for daily consumption, which is why they play a fundamental role in the life of all living beings.
  • They manufacture products that feed and supply other sectors of the economy, strengthening the entire system of extraction, production, marketing, works and services.
  • They produce profits and boost the economy of the sector and the nation.

In general, manufacturing companies play a vital role in the economyThey are fundamental for society, they generate jobs, consumer goods and income for any country.

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