Manufacturing is the second largest type of production after primary production activity 'of hunting, fishing, mining, lumbering,

farming etc. Manufacturing has undergone a big change as a result of advancement of science and technology. From the making of few simple items, like hand made cloth, khandsari, mustard oil, agricultural implements etc. manufacturing to-day involves highly technical and complex machines, equipments and tools for the assembly of automobiles, ships, aircrafts, space ships, agricultural machines, computers and so on. For centuries, manufacturing had been a household work and items like agricultural implements; weapons etc. were produced on a small-scale. But with the increasing demand due to increase in population, it took the form of cottage industry and later, large scale manufacturing industries. Manufacturing is related to processing and altering the raw materials of agriculture, forests and that of minerals into finished or partially finished products. The agro raw materials which are transformed into finished products are cotton, wool, jute, sugarcane etc. and that of minerals are iron ore, copper, manganese, mica etc. Presently, the most important manufacturing industries are those which bring together manufactured items of different industries to make complicated machines and equipments required in means of transportation, agriculture, mining, military warfare etc. Development of industries is of utmost importance to man. In fact, their development is considered to be an index of a country's economic prosperity and strength. The location of manufacturing industries depends upon a number of geographical and economic factors. These factors are known as factors of localization of industries or agglomeration of industries. The most important factors are: (i) Raw material. (ii) Source of Power. (iii) Labour. (iv) Means of transportation. (v) Market. (vi) Other factors like climate, Government Policies, capital, water, land etc. (i) Raw Material. Among the factors influencing location of an industry, close proximity to raw material availability of regular supply of cheap raw material are of utmost significance. Therefore, industries are set up close to or in the regions where raw material is available in plenty. This speaks for the localization of jute industry in West Bengal, Sugar industry in U.P and concentration of heavy industries in the states of Chattisgarh and West Bengal.

If the raw material is heavy and of small value, the industries are set up in the regions of raw material. Iron smelting, brick making, cement manufacturing are best examples. Iron and Steel Plants at Jamshedpur (Jharkhand), Rourkela (Orissa), Bhilai (Chhattisgarh) and Durgapur (West Bengal) have been set up near the sources of raw material i.e., Iron ore. (ii) Source of Power. All types of manufacturing industries depend upon one or the other sources of power. It may be coal, oil, electricity, gas etc. In the industries, especially those of ferrous metallurgy, coal is the main source of power; therefore, these heavy industries are closely tied down to coal fields. The iron and steel industry of India in the Damodar Valley of Chattisgarh at Jamshedpur is located near the coal fields of Raniganj and Jharia. (iii) Labour. Modern industry requires large labour force, both skilled and unskilled. The availability of cheap labour in a region is an important factor determining the localization of industries. Different types of industries require different types of labour force. For example, watch-making, electronics, aeronautics, computers etc. require highly skilled labour, whereas, on the other hand, cotton textile manufacturing, sugar making, jute textile etc. employ more of unskilled labour. The development of the plantations in Assam and cotton textiles in Maharashtra are attributed to the availability of cheap efficient labour. In these regions it has also been seen that industrial centres tend to attract more industries, because plenty of labour is available in these centres, for example, Mumbai and Kolkata have become industrial cities of the country mainly because of availability of plenty of labour in and around these mega cities. (iv) Means of Transportation. Industries depend upon efficient and cheap transportation system, which is essential for the movement of raw material as well as the finished products. They may be rail, road or water. Railway junctions are considered to be the most suitable sites for the localization of industries. These enjoy benefits of easy transportation from different directions. Similarly sea ports also develop as industrial centres because of availability of facilities of water transportation for export and import of products. (v) Market. Market is an important factor in determining localization of industries. Goods are manufactured to be sold in the market. Industries are generally set up close to urban centres.

Sometimes, dense population may not prove to be solid market for the disposal of the different industrial products. If the people are poor, the purchasing capacity also becomes poor. In some of the Asian countries, where people are poor, industries which are engaged in the manufacturing of cheap and essential goods like coarse cloth find an adequate market. This explains why under-developed countries, though densely populated are poor in manufacturing industries.

Location of Industry Factors

Physical Raw materials The factory needs to be close to these if they are heavy and bulky to transport. Human and Economic Labour A large cheap labour force is required for labour-intensive manufacturing industries. High-tech industries have to locate where suitable skilled workers are available. Market An accessible place to sell the products is essential for many industries:

Energy supply This is needed to work the machines in a factory. Early industries were near to coalfields. Today, electricity allows more freedom.

those that produce bulky, heavy goods that are expensive to transport those that produce perishable or fragile goods those that provide services to people

The market is not so important for other industries such as high-tech whose products are light in weight and cheap to transport. Such industries are said to be 'footloose'. Natural routes River valleys and flat areas were essential in the days before railways and motorways made the movement of materials easier. Site and land Most industries require large accessible areas of cheap, flat land on which to build their factories. Transport A good transport network helps reduce costs and make the movement of materials easier. Cost of land Greenfield sites in rural areas are usually cheaper than brownfield sites in the city. Capital This is the money that is invested to start the business. The amount of capital will determine the size and location of the factory. Government policies Industrial development is encourages in some areas and restricted in others. Industries that locate in depressed ('Development') areas may receive financial incentives from the

government and assistance from the EU in the form of low rent and rates

a) Cost-[Acquired] b) Closeness to a source of raw materials-[Natural] c) Closeness to a source of power-[Acquired and/or Natural] d) Closeness to a market-[Acquired] e) Closeness to an educated working force-[Acquired] f) Closeness to a method of transport-[Acquired] g) Government Intervention-[Government] h) In a suitable climate-[Natural] i) In a stable political atmosphere-[Government] j) Health facilities-[Acquired

Availability of Water 2. Availability of Power : Nearness to source of power or availability of power supply in an area will reduce the cost of production.In other words, this will fetch a higher income for a company as the money would be saved for the production of other goods or payment of employee salary. 3. Availability of Labor : Efficiency of labor is an important factor affecting location of industry. A higher labor force will improve production process for goods with elastic effect will create revenue.In other hand, diminishing return will be applied if more or more labor for industry. 4. Local government policies : Government policies might influence the location of industry. A favorable government policy will improve the location of industry as funds and other forms of incentives will be given to industry for the purchase of raw materials. This will help in the development of technology that will improve production of goods . 5. availability of infrastructure : Infrastructural facilities like water, good and available transport system are provide for the location of industry. 6.availability of raw materials,capital,transport and market 7.incentives (e.g, importation of machinery from Europe )

Location is a very important factor for a manufacturing business. It can impact the working of the business as a whole. It could increase or decrease the fixed costs associated with a business. Following are the six factors that affect the location decision of a manufacturingbusiness: - Proximity to raw materials - Cost of land - Tax rates - Availability of skilled labor