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Industry as a System

Types of IndustryThere are 3 main types - PRIMARY, SECONDARY & TERTIARY.

More recently a fouth type has been added - QUATERNARY

Primary Industry

- involves RAW MATERIALS- natural resources from land or sea eg: Farming

Forestry

Fishing

Mining or Drilling

Located where the raw materials are found.

Secondary Industry

- involves MANUFACTURING- processing raw materials or assembling components.

Eg; Bicycles, Iron and Steel, Cars and tins of fruit are all examples of this.

Tertiary Industry

- involves providing some kind of SERVICE. Eg: teachers, doctors, shop keepers,

secretary, accountant, lawyer. People in this sector could be employed in either of the

other two sectors.

Eg: A factory will need accountants and secretaries.

Quaternary Industry

- involved in RESEARCH & DEVELOPMENT and ICTdevelopments.

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Key Industrial L o cation FactorsHere are some of the factors a firm would need to look at when deciding on itslocation:

A suitable site (look at cost and size, type of site, flat, greenfield, brownfield,existing or propose built factories, high profile or hidden location) A suitable labour force (look at skilled / unskilled ratio, number needed andworking practices)

Industrial linkage - Links with other firms (for raw materials) Transport Links (for distribution of finished goods, receiving raw materialsand movement of labour) Government Assistance (e.g. Enterprise Zones offer ofloans, subsidies,tax incentives - provide sites. May prevent development of polluting industries.) Market (access to customers) Raw Materials (closeness can reduce transport costs).

FOOTLOOSE INDUTRY

A growing number of industries are free to locate in many locations untied bytraditional factors and their main factor may be transport. Particularly true of HighTech industries.

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Key Industrial Location Factors

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YOUR KEY CASE STUDIES

Redcar Iron & Steel works - Teeside

Bianchi Bikes - Treviglio N. Italy

Nissan Cars - Tyneside

Sony Electronics - S.Wales

Samsung Electronics - South Korea

INDUSTRIAL LOCATION CASE STUDIES: BIANCHI

Location: Treviglio, near Milan, North Italy Product: Bicycles and bicycle frames

Location factors: Raw materials: Uses component parts from linked companies. Has caused a small Multiplier effect by

attracting and encouraging the growth of component part industries eg: the wheel manufacturer. Gears

(Shimano) come from Japan

Power: Not important power from national grid

Natural routes: Trevilglio is on the main east-west plain of the River Po valley and close to the main

passes over the Alps to the rest of Europe.

Site and Land: Old location too cramped, no room to expand and expensive

New location free land, flat, well drained, green field site, room to expand, in open countryside. Labour: Skilled labour able to commute from Milan and unemployed labour available in Treviglio.

Capital: not a key factor, although the provision of free land must have freed up capital for Bianchi to

spend elsewhere.

Market: This is Europewide and it has excellent links via the Alpine passes.

Transport: Next to a number of major motorway routes to all parts of Italy, its main component

suppliers and to the European markets.

Economies of Scale: Not a key factor.

Government policies: The local government of Treviglio attracted Bianchi by offering it free land.

Improved technology: Not a key factor

Leisure activities: Not a key factor

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INDUSTRIAL LOCATION CASE STUDIES: REDCAR-LACKENBY INTEGRATED STEEL WORKS

Location: Mouth of the River Tees, near Middlesborough, N.E. England

Product: Iron and steel

Location factors: Raw materials: Iron ore, coal, limestone, water. The Iron ore is imported in bulk from Australia, North

Africa, Brazil and USA. Coal is imported in bulk from Poland. Limestone is local. Water for the cooling

process from the river Tees Power: Uses coal, but electricity can be provided by the nuclear power station nearby on the far bank of

the river Tees.

Natural Routes: The river estuary provides the ideal entrepot (entry point) for the raw materials and

for the export of the finished product.

Site and Land: Huge areas of cheap, reclaimed land are available for the storage of vast quantities of

raw materials, and the massive production plant. The integrated rolling mill is over 1km long alone. There

is room to expand and potential for further reclamation.

Labour: Large skilled labour force nearby at Middlesborough in commuting distance.

Capital: Large investment made by the British government to get the plant started and continuing

subsidies made during economic slumps. Market: Local heavy engineering industry, Nissan cars at Tyneside, Sunderland, worldwide steel market.

Transport: Sea transport by super tanker is the most important for the import of raw materials, good

rail and road facilities also exist for national markets.

Economies of scale: Not an important factor.

Government policies: Very important in the initial stages to keep jobs in the area after the closure of

less suitable steel plants inland such as Corby and Middlesborough. Also linked to the government project

of attracting heavy industry to the north east, eg: Nissan Cars.

Improved technology: Not a key factor.

Leisure activities: Not a key factor.

Now look at the Nissan Multiplier Effect Presentation

And

Multinationals / TNCs pdf.