Defining Types of Industries : Primary, Secondary, and Tertiary

When you talk about the economic progress of any country, then you may inevitably mention the word ‘industry’ quite often. This is because the nation’s industrial operations and growth serve as a critical benchmark to gauge the level of its economic growth. But what exactly is an industry? And is it different from a sector? What are the different types of industries?

If you are not very financially savvy and looking to find answers to these questions, then this blog is just for you.

What is an industry, and how is it different from a sector?

The industry is essentially a culmination of different companies and entities of different sizes and scales engaged in similar work. A sector, on the other hand, covers a broader definition of business operations. It can comprise different industries and break the overall economy into sub-categories.

There are three types of industries: primary, secondary, and tertiary. Let us know more about each type of industry and their sub-category.

Primary Industry

The primary industry typically comprises business organizations where their daily operations or business processes have minimal value addition to the final product. Most companies that fall under the primary industry have operations that are limited to sourcing raw materials from their primal raw materials, and they process it for secondary industries.

Another significant feature of companies that fall under the primary industry category is that their scale of operations is large, and they require a huge working capital. The primary industry can be further classified into a few sub-categories based on their core functionalities.

Types of primary industry

• Genetic industries
  

  This category of primary industry is involved in operations that primarily focus on processing the raw materials or enhancing them in some form to make the manufacturing of the final product easy. The best examples of genetic industries are fishing, livestock breeding, and agriculture.

• Extractive industries
  

  Extractive industries comprise companies that engage in activities related to the extraction of raw materials from their primary or original source. This includes operations such as removing minerals from their ores or mining coal and petroleum.

  
  

  Also Read: Small Scale Industries in India: Meaning, Types & Growth

Secondary Industry

The organisations that come under the secondary industry category engage in a relatively higher-level operations as compared to the primary industries. These industries utilise their resources for converting the goods produced by the primary industries into usable or finished products for end consumption.

The secondary industry includes a wide range of business processes, and it can be further divided into different sub-categories, which include:

• Manufacturing industries

  In manufacturing industries, the primary function of organisations is to convert raw materials into finished consumer products or process them further for value addition. The manufacturing industries generally have large-scale operations.

  
  
• Construction industries
  

  The construction industries, as the name suggests, are involved in the construction, building, or development of infrastructure facilities work. Here, the businesses utilise the raw materials and combine them with other resources to develop roads, construct buildings, etc.

  
  
• Heavy industries
  

  Heavy industries are categorised based on their wide scale of operations. These industries generally produce consumer and capital goods, which require a high level of manufacturing. And, also these industries have a higher degree of power requirements. Shipbuilding and heavy machinery production are some of the best examples of heavy industries.

  
  
• Assembling industries
  

  This type of industry involves putting together different pre-made parts or components to make a finished or complete product. Manufacturing of cars and electronic devices like phones or refrigerators are prime examples of assembling industries.

Tertiary Industry

The tertiary industry is quite unique and different from primary and secondary industries as it does not deal with manufacturing goods or procuring raw materials in any form. However, this industry mainly focuses on intangible services that generate income.

Services like consulting businesses, franchises, healthcare, etc., constitute this type of industry. The service industry plays a critical role in the development of the economy, and it is one of the most important sources of employment for a large portion of the population.

This type of industry can be further divided into different sub-categories, including:

• Software industries

  The software industry is one of the most booming industries in the world. It encompasses activities relating to programming, coding, security, and the development of digital infrastructure that supports most business operations.

  
  

  With the IT (information technology) industry in India expanding rapidly, it is considered to be the backbone of other industries, and it contributes significantly to the economy.

  
  
• Healthcare industries
  

  The healthcare industry, as the name says, focuses on the maintenance and improvement of the health of the people. The organisations in this industry are tasked with the responsibility of providing people relief from their maladies and helping them with keeping their health in top condition. Both public and private sector hospitals are an integral part of the healthcare industry.

  
  
• Education industries

  The education services have the primary responsibility of imparting knowledge to the students through schools, coaching centers, online training platforms, etc. Over the years, the education industry has grown manifold, and with the wide usage of digital technology, getting education has become much easier than before.

  
  

  Also Read: 8 Amazing Small Business Ideas Under ₹1 lakh in India

Difference between primary, secondary, and tertiary industries

Now that you know what primary, secondary, and tertiary industries and their sub-categories are, let us understand the difference between primary, secondary, and tertiary sectors. The following table will give you a clear understanding of the differences.

Point of difference	Primary Industry	Secondary Industry	Tertiary Industry
Definition	The primary industry mainly focuses on extracting raw materials from the natural or original source	Secondary industry typically involves manufacturing activities. It converts the raw materials into finished products or usable goods	Tertiary industry does not involve extracting raw materials or producing goods. Instead, it offers intangible services
Scale of operations	The primary industry generally medium to large-scale operations	The secondary industry typically has large-scale operations	This type of industry have different scale of operations based on the type of business the entity is involved in
Techniques used	The techniques used in primary industry are usually traditional	Business entities that are categorised as secondary industry typically use advanced technology and techniques to manufacture goods	Tertiary industry too uses advanced techniques and logistics
Examples	Agriculture, mining, forestry	Manufacturing, construction, assembling	Consulting services, healthcare services, delivery services, etc

Conclusion

The primary, secondary, and tertiary industries serve as the backbone of the country’s economic growth and contribute to its progress in their own way. And, if you are looking to start your own business that may fall under any of these industries, you may need capital investment to turn your business idea into a reality.

And, for business loans, you can rely on one of the most reliable lenders in India, Udyog Plus, which is an integral part of Aditya Birla Finance Limited. They offer a wide range of business finance and investment solutions to suit your exact needs.

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