Classification of Industries on the Product Base

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Classification of Industries on the Product Base

Friend, here we learn about the classification of industry on the product base. what is the industry to know first is that a premise where raw materials are processed through types of machinery to convert into new products whose physical and chemical properties are changed.

classification of industry
classification of industry

What is Industry

What is a classification of Industries on the Product Base we can consider this way, suppose for a time, from where your smartphone comes from? Then I answer, that you purchase your smartphone from a shop, your shopkeeper has purchased from a wholesaler, the whole seller purchased it from company stockiest.

The company made the end products from raw materials. Raw materials were purchased from different manufacturers. Then the end products manufacturer is the origin Industry of your smartphone.

Thus, we can say that an industry is a group of organizations involved in producing or manufacturing the final products.

Now we are in the position to say that industry is a premise where a final product is manufactured from different raw materials. in any type of industry where economic activities with the production of goods, services, or provision of services are performed.

Classification of Industries on the product base

On the basis of Raw materials

  • Agro-based industries: Agro-based industries are – food processing, vegetable oil, cotton textile, dairy products, and leather industries.
  • Mineral-based industries: Mineral-based industry produced the raw materials for other industries
  • Marine-based industriesThe raw materials for Marine-based industries comes from sea or ocean fish oil.
  • Forest-based industries: Products from these industries are used for the paper, pharmaceutical, and furniture industries. The main raw materials come from forests.

On the basis of the Size of the industry

Industrial Classification is done on the basis of money invested in plant and machine, labor, and the final products.

  • Micro Industries:- This industry is based on artisans and the workplace is their home. Here products are made without machines and whole families are involved in manufacturing the end products.
  • Small-scale industries: Small-scale industries have less capital and technology invested in them. There is often manual labor noticed here. For example, Basketweaving, pottery, and handicrafts.
  • Large-scale industries: Large-scale industries are the exact opposite of small-scale industries. Here the capital invested is large and advanced technology is in use here. Examples, Automobiles and Heavy Machinery.

On the basis of Ownership

  • Private sector: Private industries are businesses that are owned and operated by an individual or group of individuals.
  • Public sector: Public industries are owned and managed by the government. For example, Hindustan Aeronautics Limited (HAL)
  • Joint sector industries: These industries are jointly operated by the state and individuals. For example, Maruti Udyog.
  • Cooperative sector industries: Cooperative industries are operated by the suppliers, producers, or workers of raw material. For example, Amul India.

What are the industrial systems?

The industrial system is classified on the basis of input, output, and production process.

Input means raw materials, labor, power, water, and other infrastructure.

Output means the final products coming from the end machines.

Process means the raw materials passing through the different machines for end products.

Cluster Industry

In India, there are many clusters and running in good conditions in every state. Some of these clusters are engaged in manufacturing the final products where some of these clusters are manufactured the product for the use of industries.

See also  CGT for Micro and Small Enterprises

Classification of Industries on the Product Base  – Major Industries 

I have discussed the classification of industry on the basis of Raw materials, Size, and organization.

Now here we discuss the classification of major industries. The major industries are the Iron and Steel Industry, Textile industry. These industries are the oldest ones. These industries have played the important role in the construction of India. Today’s one of the major industries is Information Technology.


potato chips manufacturing project report

In the present time, the Iron and steel industries are centralized to Germany, the USA, China, Japan, and Russia, whereas the textile industries are centralized to India, Hong Kong, and South Korea. The new developing industry playing a major role in the country’s economy and employment is centralized in India to Bangalore and Silicon Valley of California.

The iron and Steel industry

The iron and Steel industry produced the raw materials for many other industries, so this sector is called the feeder industry.

We here learned that the industrial system produces the various inputs, processes, and outputs for other industries, such as iron ore, labor, capital, and infrastructure. Iron ore is also converted into steel by various processes.

Textile industry

The textile industry is an ancient industry, which is one of the basic needs of humans. The textile industry runs on two types of fibers one is a natural fiber and the second one is man-made fiber. Natural fibers are – cotton, jute, linen, silk, and wool, whereas the manmade fibers are – nylon, polyester, and rayon, etc.


The Textile industry is running since ancient times but in the form of Kutir Udyog. During the industrial revolution, the first machine called power loom was introduced in Britain.

In India, the first textile industry was set up in Mumbai due to its better climate for the textile industry and facility available for import and export of the machine and final products.

Information Technology industry

Information technology means to collect, process, and distribute important information data in a recognized way.

In India, information technology hubs are at Mumbai, Bangalore, Chennai, and Hyderabad due to its pleasant climate, skilled workforce, high-quality educational, technological, and scientific centers, and access to markets.

I hope you have a better understanding of the classification of industries.

Friends, you have any questions related to the post, you may comment. I will reply to my best

Thanks for reading this post.

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