Industries can be divided into three categories based on the money invested in the industry, the number of workers and the proportion of production:
1. Home industry (cottage industry)
2. Small business and
3. Large scale industry.
1. Home industry (cottage industry):
The artisan or craftsman, with the help of his family members, uses local raw materials to make the items in his house.
Production here is limited.
Produced goods are sold in the local market.
This is the smallest form of industrial production.
Craftsmen like potters, carpenters, cobblers, blacksmiths etc. make goods in the form of home industry.
Clothing, mats, utensils, small, sculptures, earthenware, boots, gold and copper ornaments, bamboo items, etc. are manufactured by home industries.
2. Small business:
The industry is larger in size than the home industry.
Employment opportunities are high here.
The help of modern power management, machinery and craftsmen is taken up in small scale industry.
Raw materials are procured remotely if they are not available in the local market.
Clothing, paper, toys, electrical appliances, utensils, furniture, edible oil, leather goods, etc. are produced in small scale industries.
3. Large scale industry:
The industry needs huge machinery, huge capital, large number of workers, national and international markets, paved roads, railway lines, telecommunication systems, banks, more water supply, skilled artisans etc.
The systems here are high value based and complex.
Here, more attention is paid to product quality and specialization.
Production occurs in larger quantities.
There are large scale industries like iron-steel, cement, petrochemical, automobile, ship, aircraft, dye-chemical making etc.