7 junio, 2024

Transformation industry: what it is, characteristics, functions and examples

What is the transformation industry?

The processing industry It is the industry responsible for the processing of various inputs or raw materials, in such a way that they are transformed into new articles or goods for human consumption.

Sometimes, the change that materials go through within the transformation industry is such that they cannot be recognized in the final product. However, on other occasions the change is minimal and the material retains many of the characteristics it had before being transformed.

The importance of this type of industry lies in the fact that the industrialists who process the raw materials will never sell them as they bought them. In fact, they will always try to sell them after having applied a rigorous transformation process that makes them even more attractive for human consumption.

Therefore, the final price of the transformed materials will not be exclusively linked to the inputs that make them up, but also to the processes that they had to go through to reach a new desirable shape for the consumer.

In this sense, the transformation industry is in charge of both the acquisition of materials and their transformation, making use of various production methods, until obtaining a finished product suitable for human consumption.

How the transformation industry is defined

At the heart of any manufacturing industry are transformation technologies. In this sense, any process can be understood as a system in which various inputs interact with technology to become products.

This is how the manufacturing industry has a group of resources (inputs) and a number of processes designed to modify the state of said resources.

Scheme of the transformation

The processes within the transformation industry are composed of a scheme of input current and output potential.

This means that the input stream will always be made up of the inputs or raw materials necessary to manufacture a product, and the output potential will always be defined as all the operations that take place to transform the raw material.

These operations include equipment, trained labor, time, direction, financial resources, among others.

Characteristics of the transformation industry

– It uses raw materials and converts them into another product.

– Generally, it uses technological processes for the transformation of raw materials.

– They have a wide production record: from any merchandise object to furniture, clothing, textiles, automobiles, etc.

– They can use raw raw materials or goods produced by other industries (intermediate goods), such as plastic, paper or wood.

– Normally, the transformation process has different phases, until reaching the finished product.

Objectives of the transformation industry

The main objectives of all those industries that are dedicated to the transformation of raw materials are the following:

– Manufacture high-quality products, without this representing economic losses for the company. In other words, costs must always be under control without affecting the final quality of the product.

– Satisfy production demands according to what the market is requesting.

– Reduce costs and, if possible, increase product quality.

– Increase the productive capacity of the company, according to its strategic objectives.

– Increase profit margin while providing excellent working conditions to staff.

– Be highly productive, that is, achieve a balance between the volume of manufactured products, the resources used for their production and their sales volume. In essence, this is the main objective of the transformation industry.

Functions of the transformation industry

The transformation industry mainly fulfills the functions of acquiring raw materials, assigning the necessary labor for its transformation, controlling the costs derived from production and ensuring the correct completion of the product and its distribution.

All these functions are mainly divided into three categories which are described below:

purchase function

The purchasing function is responsible for obtaining the inputs or raw materials necessary to carry out the production processes.

In this way, the inputs must meet certain standards that ensure the quality of the products once they are transformed.

On the other hand, the purchasing function must ensure that costs and delivery times are taken care of, in such a way that these two variables do not have any type of repercussion on the final consumer.

In order to be able to carry out the material transformation processes on time, it is necessary that purchases be made in advance.

It is also important to consider the volume of purchases to be made, as this should not interfere with inventory logistics.

The purchase function generally has a statistic that allows analyzing the behavior of suppliers.

production function

The production function is the most visible and significant within the transformation industry. This function is responsible for transforming inputs and raw materials into finished products, suitable for human consumption.

This function takes into account that the transformation of inputs does not affect the quality and price of the final products.

It is the function that encompasses the basic resources necessary for manufacturing, which include inputs, machinery, labor, external services and money.

All manufacturing industries depend on this function to collect, record and control the costs derived from the transformation of materials.

distribution function

Once the processes of purchase and transformation of the material have been successfully completed, the final products must be transferred to a warehouse.

From this warehouse the distribution function is carried out, through which the articles are packed and dispatched to the clients, according to their previous requests. During the distribution function, sales are closed.

Some of the main activities carried out with the distribution function are the following:

– Operation and inventory management of finished products in the warehouse.

– Control of output of products to customer facilities.

– Control of costs derived from the movement of products from the warehouse to the client’s facilities.

– Record of all information derived from the distribution of finished products.

– Collection of outstanding accounts from customers.

Examples of transformation industries

– The food industry: for example, transforming milk into butter, cheese and yogurt.

– A shoe factory, which needs leather and other inputs to make footwear.

– The textile industry, which uses raw materials (such as wool fibers, silk, cotton, dyes, etc.) and produces fabrics with which clothing will later be made.

– A carpentry, which receives the raw wood and then transforms it into various objects, such as furniture.

– The automotive industry, which requires various raw materials to produce and assemble different vehicles.

References

Manufacturing industry. Recovered from definitionabc.com
Definition of Manufacturing Industry. Recovered from definition.mx

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