Difference between Manufacturing and Production

Meaning

Manufacturing refers to the process of converting raw materials, components, or parts into finished goods through various methods, such as machining, assembly, molding, or fabrication.

Production encompasses the entire process of creating goods or services.

Scope

Manufacturing encompasses the entire production process, from the initial design and engineering of products to the final packaging and distribution.

Production covers all stages of the value chain, from sourcing raw materials to delivering finished products to consumers.

Process

It involves both physical and mechanical processes to create goods on a large scale.

It includes both manufacturing and non-manufacturing processes, such as farming, mining, construction, transportation, and service provision.

Industry

Manufacturing is commonly associated with industries that produce physical goods, such as automotive, electronics, textiles, food and beverage, pharmaceuticals, and machinery.

Production is a broader concept that applies to various industries, including manufacturing industries as well as non-manufacturing sectors such as agriculture, mining, construction, transportation, utilities, and services.

Output

The output of manufacturing processes is tangible goods or products that are ready for sale or use by consumers.

The output of production encompasses both tangible goods and intangible services.

Value Addition

Manufacturing adds value by transforming raw materials or components into finished goods that have utility and can be sold to customers.

Production adds value not only through manufacturing but also through other stages of the value chain, such as sourcing high-quality raw materials, efficient processing, effective distribution, and providing excellent customer service.

Examples

Examples of manufacturing activities include automobile assembly, electronics manufacturing, textile production, food processing, and pharmaceutical manufacturing.

Examples of production activities include agricultural production (farming), oil and gas production (extraction and refining), construction (building), software development (programming), and entertainment (filmmaking).