Types of Industries
can be classified on the basis of
(a) Users: If the
output is consumed by the final consumer, it is called a consumer goods sector.
If the output is consumed by another producer, it is called a capital goods
sector. There are industries that produce raw materials for other industries
such as cement and steel. Such industries are called basic goods industries.
(b) Type of Inputs Used:
Industries are also classified based on the kind of raw material used such as
agro-processing, textiles sector, rubber products, leather goods, etc.
(c) Ownership: Firms
may be privately owned, publicly owned (by the government, central or state),
jointly owned by the private and public sector, joint sector or cooperatively
(d) Size: Firms
may be large, small or medium based
on their volume of output, sales or employment or on the basis of the amount of
investments made. There are also micro or tiny enterprises that are smaller
than even small firms.
sector is seen as important for two reasons. One, it is believed to generate
more employment than the large-scale sector, which is likely to use more
advanced and automated technologies and therefore may not generate enough
employment. Second, the small scale sector allows for a larger number of
entrepreneurs to emerge from less privileged backgrounds.
experiences of industrialisation in different parts of the world, it is
believed that when small firms specialising in one sector are geographically
concentrated in specific locations, and linked to one another through
production and learning, they tend to be equally if not more efficient than
large scale enterprises. Such agglomerations of small firms are called