What type of goods includes raw materials used to produce other products?
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A raw material, also known as a feedstock, unprocessed material, or primary commodity, is a basic material that is used to produce goods, finished goods, energy, or intermediate materials that are feedstock for future finished products. As feedstock, the term connotes these materials are bottleneck assets and are required to produce other products. Show
The term raw material denotes materials in unprocessed or minimally processed states; e.g., raw latex, crude oil, cotton, coal, raw biomass, iron ore, air, logs, water, or "any product of agriculture, forestry, fishing or mineral in its natural form or which has undergone the transformation required to prepare it for international marketing in substantial volumes".[1] The term secondary raw material denotes waste material which has been recycled and injected back into use as productive material.[2] Ceramic[edit]While pottery originated in many different points around the world, it is certain that it was brought to light mostly through the Neolithic Revolution. That is important because it was a way for the first agrarians to store and carry a surplus of supplies. While most jars and pots were fire-clay ceramics, Neolithic communities also created kilns that were able to fire such materials to remove most of the water to create very stable and hard materials. Without the presence of clay on the riverbanks of the Tigris and Euphrates in the Fertile Crescent, such kilns would have been impossible for people in the region to have produced. Using these kilns, the process of metallurgy was possible once the Bronze and Iron Ages came upon the people that lived there.[3] Many raw metallic materials used in industrial purposes must first be processed into a usable state. Metallic ores are first processed through a combination of crushing, roasting, magnetic separation, flotation, and leaching to make them suitable for use in a foundry. Foundries then smelt the ore into usable metal that may be alloyed with other materials to improve certain properties.[4] One metallic raw material that is commonly found across the world is iron, and combined with nickel, this material makes up over 35% of the material in the Earth's inner and outer core.[5] The iron that was initially used as early as 4000 BC was called meteoric iron and was found on the surface of the Earth. This type of iron came from the meteorites that struck the Earth before humans appeared, and was in very limited supply. This type is unlike most of the iron in the Earth, as the iron in the Earth was much deeper than the humans of that time period were able to excavate. The nickel content of the meteoric iron made it not necessary to be heated up, and instead, it was hammered and shaped into tools and weapons.[6] Vyasanakere Iron Ore Mine Iron ore[edit]Iron ore can be found in a multitude of forms and sources. The primary forms of iron ore today are Hematite and Magnetite. While iron ore can be found throughout the world, only the deposits in the order of millions of tonnes are processed for industrial purposes.[7] The top five exporters of Iron ore are Australia, Brazil, South Africa, Canada, and Ukraine.[8] One of the first sources of iron ore is bog iron. Bog iron takes the form of pea-sized nodules that are created under peat bogs at the base of mountains.[9] Conflicts of raw materials[edit]Places with plentiful raw materials and little economic development often show a phenomenon, known as "Dutch disease" or the "resource curse", which occurs when the economy of a country is mainly based upon its exports because of its method of governance.[10] An example of this is the Democratic Republic of the Congo.[citation needed] Raw materials are also used by non-humans, such as birds using found objects and twigs to create nests. A product is the offering a business provides to its customers in return for a monetary benefit. This offering can be a tangible item like a mobile phone or a doormat, or an intangible thing like a delivery service or cab service. Generally, anything that’s offered for sale is a product. Sometimes it’s the offering a customer buys in a store. Sometimes, it’s the customers themselves. A perfect product in the right market makes for a glorious combination for a business. The market consists of consumers and industries, and businesses can cater to either or both. But what are the types of products that one can find in the market? What do they mean? And finally, what do they consist of? Let us find out! Contents show 1 The Two Types Of Products 1.1 Consumer products 1.1.1 Convenience products 1.1.2 Shopping products 1.1.3 Speciality products 1.1.4 Unsought products 1.2 Industrial products 1.2.1 Raw materials 1.2.2 Capital products 1.2.3 Essential Equipment 1.2.4 Component Materials 1.2.5 Accessory products 1.2.6 Services and supplies The Two Types Of ProductsTechnically, every product that exists today can be categorised into two types depending on who it is targeted at:
Consumer productsConsumer products are those that have direct utility to consumers. Individuals consume these products to satisfy their needs and wants. Some examples of consumer products are smart TVs, cheese, bread, toothbrush, and motorcycles. These products also involve services that directly satisfy consumers’ needs, like cab services or food delivery services. Consumer products are further classified into four broad categories based on the purchasing behavior of the customer:
Convenience productsConvenience products are inexpensive products that don’t require much effort from the customer to select and purchase them. They are usually produced in huge quantities as they already have a set demand. These products are easy to find, typically in grocery stores and major eCommerce websites, and don’t cost a lot. Additionally, customers use these products in small quantities since they can buy them frequently. Products used daily by individuals, such as toiletries and medicines, are examples of convenience products. Convenience products are further classified as staple, impulse, or emergency products.
Shopping productsShopping products are consumer products that the customer purchases less frequently and compare with other alternatives on quality, price, style, etc. Unlike convenience products, these products require individuals to make little effort to purchase them. It is because consumers engage in comparing features and prices before finally buying these products. Consequently, purchasing these products usually takes more time. Examples of shopping products are smartphones, laptops, or a dinner table. These products can be classified as homogeneous or heterogeneous shopping products.
Speciality productsSpeciality products are products with unique characteristics or images for which a significant group of customers is willing to make an extra effort. These types of products are usually desired but not needed, and they apply only to certain customers. Speciality products require special purchase efforts from the customers and often need considerable amounts of time to come to a decision. The sale of speciality products usually depends a lot on consumer loyalty. Hence, these businesses invest significant amounts of time into perfecting their goods and services and positioning them well to keep their customers coming back for more. Usually, speciality products are less compared against other products as they have their fan-base. The effort, however, is put in terms of other factors – these products can be highly limited in quantity, highly-priced, or available only in select stores. There is often a strong sense of loyalty seen in consumers who purchase such products. A consumer who favours one brand for its superior quality will travel to great lengths to acquire that brand’s product. Take Lamborghini, for example. A customer doesn’t spend time comparing it with other brands. Instead, they put in the effort to arrange funds and visit the store even if it is far off. Other examples would be Louis Vuitton bags, Swarovski crystals, and Louboutin shoes. One may also be particularly inclined towards visiting their favourite salon to experience their exclusive service. Unsought productsThere are some products that a customer never considers buying under normal conditions; that is, the customer does not normally think about them, at least not until they need them. For example, one seldom considers buying an oxygen cylinder, life insurance, or funeral service. These products are often unheard of, as they haven’t been marketed enough or are not necessarily considered a requirement in life. Another example of an unheard-of product is a new headphone model that is yet to be heard of by the consumer. Usually, unsought products are the hardest marketing task for a business. They require an extensive marketing campaign, high-budget advertising, and highly trained sales professionals. Industrial productsIndustrial products are products that are used to produce other goods. These products cannot be used directly, have to be processed, or are used for processing raw materials. Such goods and services usually include machinery, manufacturing plants, raw materials, technicians or engineers services, etc., targeted to businesses or industries who use them to produce other products. Generally, industrial products have the following characteristics:
Industrial products are further classified into six types. These are: Raw materialsRaw materials are products that are processed before being sold in the consumer market as finished products. Natural resources such as wood and agricultural products such as cotton and livestock like sheep for wool provide industries with raw materials. Take jute, for example. It’s a natural fibre derived from plants. This fibre is sent to a factory that processes it and eventually sells it in the consumer market as jute bags. Here, jute is the raw material which is the product that companies purchase from farmers to produce jute bags, among other products. Capital productsCapital products include industrial products that are directly used for the production of other goods and services. This includes factories or buildings, land, and machines. These are industrial products that allow a business to function, for without a factory, a business can not produce a product for the consumer market. Services like DHL, which deliver products, require a warehouse to store parcels. Hence, a warehouse is an industrial product, and so is an office. Essential EquipmentThese are the utility products used to produce, process, or sell other products. These are essential products without which a business cannot run. Imagine a big factory with no conveyor belts. It would lead to chaos, with workers running around, shifting items from one place to another. A conveyor belt plays the integral role of transporting packages and other items from one piece of equipment to the next. This allows for the successful processing and production of products efficiently. Engines, tractors, conveyor belts, and forklifts are just some of the few examples of major essential equipment. Component MaterialsThese products are processed inputs that are used to make the final output. Component materials essentially become a part of the final product. Unlike raw materials that come through nature, a component material is an already processed input. An example of this is a paper sent to a publishing house used to make books or newspapers. Here, the paper has undergone the paper-making process previously, making it a component material. Accessory productsThese are products that lend a helping hand in the production process or the product’s selling process. They do not become a part of the final product but enable the manufacturing or selling of the product. Small tools and even display racks are examples of these products. Services and suppliesThis involves the workforce in charge of maintaining, consulting, repairing, and cleaning, among other services. When an individual takes up the job of serving a business in any manner, the individual’s service becomes an industrial product. These individuals enable the smooth operations of industry and directly or indirectly contribute to other products’ production. A salesperson can also be an example of this, as he aids in selling a particular product. As for the supplies, these are the convenience products in the industry. They are frequently used and can be conveniently acquired. Examples of services and supplies include pens, glue, and A4 size papers used in an office setting, a cash register, and even small maintenance tools such as a screwdriver. Go On, Tell Us What You Think!Did we miss something? Come on! Tell us what you think about our article on types of products in the comments section. Siddhi Kamble A startup enthusiast who enjoys reading about successful entrepreneurs and writing about topics that involve the study of different markets. What type of goods includes raw materials?Thus, industrial products are differentiated from consumer products based on their ultimate use. The types of Industrial goods are raw materials, component parts, major equipment, accessory equipment, operating supplies, and services.
What products are produced using raw materials?Direct raw materialsThe primary component from which a finished product is made is called direct raw materials. For example, wood is a direct raw material from which furniture like chair, tables, bed, etc. are made. Another example is leather used for making purses, shoes, bags, etc.
What are goods used to make other goods called?Intermediate goods are products that are used in the production process to make other goods, which are ultimately sold to consumers. The intermediate goods are sold industry-to-industry for resale or to produce other products.
Which type of industry uses raw materials to produce goods and services?Manufacturing Industry
These are the industries that are involved in the process of converting raw materials or semi-finished products into finished products. Manufacturing industries create form utility as it changes the form of raw materials into finished goods.
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