INDUSTRY

• Industry: Industry is any business activity or commercial enterprise.

• An industry is a system like farming, have inputs , processes and
outputs.
• Inputs are the elements that required for the processes to take place.
Inputs include raw materials, labour, energy and capital
• Processes are the industrial activities that take place in the factory to
make the finished products. For example in a car industry processes
include moulding sheet steel into shaped panels that make up the car .
• Outputs comprise the finished product or products that are sold to
customers. Sometimes by products may be produced. A by product is
something that is left over from the main production processes which
has some value and therefore can be sold. All the manufacturing
industries produce waste product which has no value and must be
disposed of.
 INDUSTRY TYPES

• Manufacturing -To manufacture means to make.

Manufacturing industry is the general term used for the
secondary sector of economic activity.
• Processing and assembly- processing industries are
based on the direct processing of raw materials.
Processing industries are often located close to their raw
materials.
• In contrast assembly industries put together parts and
components that have been made elsewhere. These
have wider choice of location than processing industries
and thus they are often described as footloose industries
 INDUSTRY TYPES
• High technology is the fastest growing
manufacturing industry.
• Hi-tech industry: Industries that are focused
on research and development and the
production of products that often contain
microchips.
• It all began in silicon valley south of san
francisco and spread across the world.
 INDUSTRY TYPES
• Hi-tech companies use or make silicon chips,
computers software, robots, aerospace
components and other very technically
advanced products.
• These companies put a great deal of money
into scientific research. Their aim is to develop
newer ,even more advanced products. Think of
the latest products from companies such as
Apple, Samsung, Sony and Nokia.
 INDUSTRY TYPES
• High technology industries often cluster
together in science parks,the idea for which
was originally created in the USA.
• They are often found in close proximity to
leading universities because of the need to
employ well qualifie graduates in science and
technology and to be aware of the latest
research taking place in universities.
 FACTORS AFFECTING THE LOCATION OF
INDUSTRY.
• HUMAN FACTORS
• Skilled Labour: In some industries especially quaternary it is important that there is an availability of skilled labour.
Cheap Labour: In other industries like clothes production an availability of cheap labour is very important. This why
many clothes factories locate in LEDCs.
Available Capital: For industries to build factories or offices, research and develop new products or enter new
markets, they need access to money.
Market: For any industry to survive, they need customers. Therefore it is very important to locate near their potential
market.
Supply Network: Most industries have a large supply network. To ensure the smooth production of products it helps
being close to suppliers.
Good Housing: To attract any workers it is important to have suitable housing nearby. For quaternary industries this
might be good quality housing for secondary industries this might be high density cheaper housing.
Good Schools and Hospitals: Again to attract workers and especially their families, it is important to have good
nearby schools and hospitals.
Nearby Universities: For quaternary industries that carry out a lot research and development they need to be located
near universities that have skilled workers and available laboratories.
Transport Links: It is important to be close to good roads and rail links so that industries can receive supplies and
distribute products.
Good Communications: It is now very important for industries to have good communications so that they can contact
suppliers and customers.
Reliable Electricity and Water Supply: For all industries a constant electricity supply is essential because industries
can't afford breaks in production.
 FACTORS AFFECTING THE LOCATION OF
INDUSTRY.
• PHYSICAL FACTORS
• Flat Land: It is a lot easier to build on flat land than hilly land so most industries look for flat sites.
• Available Land: If industries are successful they will want to expand, so most industries will look for sites
that have the potential to expand factories/offices.
• Unpolluted Land (Greenfield Site): Most industries would prefer to build on greenfield sites. This is
because there are no clean up costs before building.
• Natural Transport Links: In an increasingly globalised world, products are now sold worldwide. Therefore
it is important to be close to natural transport routes e.g. rivers and the coast.
• Available Raw Materials: For any industries that use raw materials (especially weight loss industries), it is
very important to be close to them
• .Renewable Energy Sources: It is becoming increasingly important for companies to demonstrate their
sustainability. Therefore it will become increasingly important to have access to renewable energy sources
(wind and sun).
• Nice Environment: For tertiary and quaternary industries who are trying to attract skilled workers it is useful
to be near a nice environment to make working their more attractive.
• Water Supply: For many industries, especially manufacturing, it is very important to be near a reliable water
supply (river or reservoir)
• .Climate: For some industries a good climate can be very important. For example you would not locate a
solar panel research and development company in a place where the sun never shines.
 COMBINED INFLUENCES ON LOCATION, SCALE
OF PRODUCTION ANDF METHODS OF
PRODUCTION
• The combined influence of a range of factors will
have an impact on the decision making of a
company in terms of the following:
• Location-companies look the location that is seen
as the least cost location or the highest profit
location. A poor choice of location can mean a
company making a loss and eventually closing. An
excellent location, resulting in considerable
profits, may prompt a company to expand.
 COMBINED INFLUENCES ON LOCATION, SCALE
OF PRODUCTION AND METHODS OF
PRODUCTION
• Scale of production- the amount of a product a company
plans to produce will enable it to grow due to the
economies of scale. However if they decide on a larger
scale of production they have to be sure that they
• (a) have a physical site large enough for the desired scale
of production
• (b)can recruit sufficient skilled labour in the region and
• (c) will have enough customers for their higher scale of
production.
 COMBINED INFLUENCES ON LOCATION, SCALE
OF PRODUCTION AND METHODS OF
PRODUCTION
• Methods of organisation- companies can
follow various methods of organisation from
the traditional to highway innovative. The
most advanced companies in an industry tend
to be very capital intensive while more
traditional companies tend to be more labour
intensive.
 COMBINED INFLUENCES ON LOCATION, SCALE
OF PRODUCTION AND METHODS OF
PRODUCTION
• The product or range of the products
manufactured - some locations may be more
suited to the production of one product than
another because of the cost factors involved.
 Industrial zones and estates
• Industrial agglomeration is the clustering
together of economic activities. This can result
in companies enjoying the benefits of external
economies of scale. This means lowering of
firms cost due to external factors. The success
of company may attract other companies from
the same industry group. External economies
of scale can be subdivided into:
• Urbanisation economies which
are the cost savings resulting
from urban location due to
factors such as the range of
producer services available and
the investment in infrastructure
already in place
 Localisation economies which
occur when a firm locates close to
suppliers (backward linkages)or
firms that it supplies (forward
linkages).this reduces transport
cost allows for faster delivery and
facilitates a high level of personal
communication between firms
 Industrial estates
• An industrial estates is an area zoned and
planned for the purpose of industrial
development. A more lightweight version is
the business park of office park which has
offices and light industry .
• Industrial estates can be found in a range of
locations from inner cities to rural areas. There
are usually located close to transport
infrastructure.
 INDUSTRIAL ESTATES
• The logic behind industrial estates includes
• Concentrating dedicated infrastructure in a small area
to reduce the per business expense of the
infrastructure.
• Attracting new business by providing an integrated
infrastructure in one location.
• Separating industry from residential areas to try to
reduce the environmental and social impact.
• Eligibility of industrial estates for grants and loans
under regional economic development policies.
 CASE STUDY OF AN INDUSTRIAL ZONE
• The M4 Corridor (Hi-tech industries)
•
The M4 corridor is the area either side of the M4
motorway (main road) running from London in the east of
the UK across to Bristol and Cardiff in Wales (the west of
the UK). The area has become famous because of its
concentration of hi-tech industries. Many hi-tech industries
are footloose so not tied to a particular raw material.
Therefore they are able to look at other locational factors.
The M4 corridor has become a popular location because:
 CASE STUDY OF AN INDUSTRIAL ZONE
• Transport - The M4 road runs through the region and connects to the M25 and M5. London
has five airports (including the world's busiest international airport (Heathrow). There are
also further airports in Bristol and Cardiff. A railway line also runs through the region.
• Labour - there is a large pool of workers, not only in London, but also Swindon, Reading and
Bristol.
• Universities - Cardiff, Bristol, Bath, Reading and of course London have multiple universities
that can not only supply skilled labour but also research and development facilities.
• There are attractive areas to live nearby and enjoy recreation time e.g. Cotswolds and
Mendip Hills.
• Market - Much of the South of England is wealthy so there is a large potential market for
new products.
• Existing Industries - There is already existing government research facilities and other
research based companies like British Aerospace and Rolls Royce in the area.
• Conglomeration - If hi-tech firms group together they can share associated services.
Associated companies may range from cleaning and security firms, to IT repair and research
labs. By sharing services it should reduce costs and increase the amount offered.