Today, I will acquaint you with the meaning, definition and some examples of a manufacturing business.
The term ” manufacturing ” is defined as the process of turning raw material into finished goods with the help of tools & equipment, machinery and labour. For example, paper is manufactured out of pulpwood logs.
An entrepreneur who undertakes a manufacturing uses whatever is required to make finished goods out of raw material. The machinery, tools, and labour are few to mentioned requirements of a manufacturing firm. The raw material is the input while as finished goods is the output.
It is worth to note here that manufacturing makes tangible finished products from the tangible raw material. Tangible products are goods that can be physically touched, seen and measured while as intangible products lack physical nature.
Bed, chair, Tea bags etc are examples of tangible goods whereas music, mobile applications, software, trademark represent the good examples of intangible goods.
A firm involved in the manufacturing process is called a manufacturer or a manufacturing business. A good and a simple example of a manufacturing business is that of a clothing firm involved in the conversion of textiles into garments.
Generally, starting a manufacturing business requires a big investment in plant or factory setup and raw material.
However, there are enormous manufacturing business ideas on the table of an aspiring entrepreneur that don’t need much amount of capital to start. But risks involved in a manufacturing business are greater compared to other business types.