what is manufacturing

All entrepreneurs who undertake a manufacturing business use whatever is required to make finished goods out of raw materials. Some of the important requirements of their manufacturing firms include machinery, tools, raw materials, and manpower. The raw materials are the input while finished goods are outputs.

The term ” manufacturing ” is defined as the process of turning raw material into finished goods with the help of tools, machinery, and labor.

It is worth describing here that manufacturing involves making of tangible goods from raw materials. Tangible goods are products people can physically touch, see, and measure while intangible goods on the other hand lack physical nature. Some good examples to make you understand what are tangible goods include beds you use for sleep, chair to sit on, and tea bags while music, mobile applications, computer software, and trademark represent some fine examples of intangible goods.


A business involved in the manufacturing process is called a manufacturer or a manufacturing business. Some simple examples to describe a manufacturing business are clothing firms involved in the conversion of textiles into garments, steel firms making steel products, leather companies that makes shoes from leathers. All the products these companies manufacture are tangible in nature.


Just as there are benefits of a manufacturing business, there are several challenges as well. Capital requirements could be hefty as you would be buying machinery and building your plant. Your work labor could become a victim of accidents and the other challenge is that there is a long legal process to obtain permission and documents for your operations.

Starting a manufacturing business requires a big investment for plant setup, manpower, and raw materials. But entrepreneurs with a budget issue need not be worried as there are enormous manufacturing business ideas on their table that don’t require much amount of startup capital. However, risks involved in a manufacturing business are greater as compared to the other types of businesses. You can’t expect a quick break-even in a manufacturing business as it takes time but once you get to that, your profits could make you whole life.

Susan Ranford

My name is Susan Ranford. I am an expert on job market trends, hiring, and business management. I often write about issues related to employment and business.