Manufacturing Is: Definition, Types, and Business Processes

There are several types of companies in Indonesia. One of them is the type of manufacturing company. You may have often heard of this type of company. But what exactly is the meaning of a manufacturing company?

From an economic perspective, companies absorb a large number of workers, thereby indirectly increasing per capita income and the standard of living of the Indonesian people.

For more details about manufacturing, here DailySocial.id will explain it to you!

Definition of Manufacturing and Manufacturing Company

Technically, manufacturing is the processing of raw materials which are processed by chemical and physical processes. The goal is to change the shape, nature and appearance of the product. Therefore this manufacturing covers the entire assembly process to the finished product.

Meanwhile, from an economic point of view, manufacturing is a process in which raw materials are converted through assembly into a form that already has added value. So that the end result is expected to have a sale value.

In short, a manufacturing company is a business entity that converts raw materials into semi-finished products and finished products that have a sale value. All of these processes are of course carried out in accordance with the Standard Operating Procedures (SOP) of each industry.

Manufacturing Company Character

Manufacturing companies are different from other types of companies. This is what makes it easier for you to differentiate this company.

However, for those of you who are still confused, here are some of the characteristics of manufacturing companies that you need to know.

Complex Production Process

The first feature of a manufacturing company is having a very complex production process. The goal is for the company to be able to produce suitable products and work with many people in various industries.

For example, the operator is responsible for ensuring the machine works according to its function. The quality control officer can then do his job to check whether the product results are reasonable or not.

Product Management Process

The activity of a manufacturing company is to transform raw materials into valuable products. In general, there are two methods that are commonly used. continuous and intermittent methods.

The process is continuous. This means that it takes a long time to manufacture because it consists of various components that need to be manufactured. One example is the process of making a car.

Intermittent processes mean creating products that meet consumer needs and wants. Therefore, companies must not only produce these products, but also must be able to meet consumer demands.

Huge Production Costs

It is undeniable that a large production process also requires large costs as well. This is because the machines and equipment used must be of superior quality so that the product results do not disappoint consumers.

In addition, the largest production costs also come from purchasing raw materials, paying labor wages, machine maintenance costs, and so on.

Even so, the profits obtained by manufacturing companies are also comparable to the costs of production.

Use of Large-Scale Machines

Most manufacturing companies in Indonesia definitely use large-scale machinery and equipment. Of course the use of this machine aims to support the production process. Manufacturing is a company that needs a fast and efficient process.

Even so, this industry still needs humans to help smooth the production process.

In addition, the workforce in the manufacturing industry is also tasked with controlling various machines and equipment. If there is damage, then they will immediately fix it.

Marketing and Sales

The company's production process is closely related to product marketing and sales. When there are problems in the marketing and sales process, other bigger problems arise.

Therefore, every manufacturing company must have a marketing department whose job is to market their products so that they always grow from month to month. Often several companies are willing to spend large amounts of money to carry out campaigns.

Of course, the company runs a campaign to introduce its products to the wider public. The wider the advertising reach and market, the more likely it is that the marketing department will win over consumers.

Manufacturing Company Business Process

Just like other types of companies, manufacturing companies also have business processes that are carried out.

Here are the business processes of manufacturing industry companies that you should know:

Process Stage Procurement

The third stage is the process procurement closely related to the procurement of goods and various other needs related to the production process. This process is not limited to the procurement of raw materials, but other components that support the performance of employees.

In Out Inventory

This process is responsible for handling incoming and outgoing goods within the company. Therefore, at this stage it really requires good physical and digital records so that control over the flow of goods can be maintained and running well.

Production Process Stages

At this stage of the production process, it becomes a core part of the manufacturing industry because it functions to convert raw goods into finished goods that have a sale value. This production process must also run according to operational standards and have gone through the process Quality Control.

Sales and Marketing

Marketing is one of the most important parts of a business. Companies that do not have a good marketing strategy, the sales process will not work either. So, it's no wonder that every manufacturing industry has its own marketing strategy.

Administration and General

This process runs from the beginning to the end of production which includes supervision, direction, policy determination, management, to company administration.

Accounting and Finance

The accounting process aims to ensure that the company's finances are well managed. So, all company transaction processes must be recorded in the company's financial activities.

That's the full explanation and details. Starting from the understanding of manufacturing companies, characters, examples, to business processes. Hopefully this information adds to your insight!