You clicked to get a straight answer, not a maze of legalese. Here’s the core idea: governments define manufacturing to decide who counts as a producer for stats, permits, taxes, grants, and regulations. The wording changes by country, but the test is very similar everywhere-did you transform inputs into a new, tangible product? This guide breaks down the official lines (U.S. NAICS, UK SIC, EU NACE, Australia/NZ ANZSIC, India NIC), shows the gray areas, and gives you a simple way to check where you land.
TL;DR: The government definition of manufacturing, in plain English
- Core concept across countries: Manufacturing is the physical, mechanical, or chemical transformation of materials or components into new tangible products. This includes assembly and sometimes packaging. This is the gist in U.S. NAICS 31-33 (2022), UK SIC 2007 Section C, EU NACE Rev. 2 Section C, Australia/NZ ANZSIC06 Division C, and India NIC 2008 Section C.
- What it is not: Retailing goods you didn’t make, construction on building sites, farming, pure logistics, and most services (design, consulting, software). These are classified elsewhere.
- Edge cases hinge on scale and intent: A bakery selling mostly wholesale? Manufacturing. A small retail bakery making bread for walk-in customers? Often retail. 3D printing parts you design and sell? Manufacturing. Installing the product at a building site? Usually construction, not manufacturing.
- Special India wrinkle: India’s Factories Act defines “manufacturing process” very broadly (includes finishing, packing, cleaning, printing, power generation). This can pull in activities that other countries treat as services.
- Practical test you can use now: If you start with inputs (materials/components) and finish with a new product you can touch, and your main business is that transformation, you’re likely in manufacturing in most government systems.
Primary sources you’ll see referenced here: U.S. Census Bureau (NAICS 31-33, 2022), UK Office for National Statistics (SIC 2007 Section C), Eurostat (NACE Rev. 2 Section C), Stats NZ and ABS (ANZSIC06 Division C), India’s NIC 2008 Section C, and India’s Factories Act, 1948 (Section 2(k)), plus India’s DPIIT FDI Policy for the contract manufacturing angle. No links-just the official names so you can search them if you need to.
One more thing before we get into the weeds: the government definition of manufacturing is used for classification first. Specific tax credits, grants, or rules can add extra conditions. Always check both the base definition and the scheme’s fine print.
How to tell if your work counts as manufacturing (step-by-step)
Use this quick path. It mirrors how statistical agencies and regulators think about it, without the bureaucracy.
What is the main thing you sell? If it’s a tangible product your business makes (not just resells), keep going. If it’s time-based services (design, maintenance, training, software-only), you likely aren’t manufacturing for classification.
Do you transform inputs into a new product? Look for a “substantial transformation”-the end product has a new name, character, or use. Cutting steel into sheet sizes is light processing; machining a gearbox housing is transformation. Mixing, baking, fermenting, molding, soldering, welding, coating, or assembling into a new good = manufacturing.
Is the transformation the main activity? If transformation is your core revenue driver (not a side step), you’re likely in manufacturing. If you buy finished goods and only customize slightly (engraving, labeling) before retail, you’re probably retail/wholesale with an ancillary activity.
Where does the work happen? Manufacturing usually happens at your premises or a plant. Work on a building site (installing HVAC, wiring, fit-out) is usually construction (even if you fabricate some parts). If you run a plant and also install what you make, you may have both a manufacturing unit and a construction unit.
How is it classified locally? Check your country’s code set: NAICS (US/Canada) 31-33; SIC 2007 Section C (UK); NACE Rev. 2 Section C (EU); ANZSIC06 Division C (Australia/NZ); NIC 2008 Section C (India). If your activity matches examples there, that’s your anchor code.
Do any special rules override the base definition? Tax incentives, environmental rules, zoning, and labour laws sometimes expand or narrow who counts. For example, India’s Factories Act uses a wider “manufacturing process” than statistical NIC. Some grant programs exclude assembly that’s too simple; others include it.
Simple decision rules you can keep in your back pocket:
- If you can hand someone your product and they can use it without you, that’s a strong sign of manufacturing.
- If most of your revenue is from building or installing at a site you don’t control, you’re flirting with construction, not manufacturing.
- If your work is digital-only (code, design files) and nothing physical ships, that’s not manufacturing-unless you also produce a physical output (e.g., you 3D print it and ship it).
- If you change what the input is and does, not just its packaging or size, it leans manufacturing. Packaging alone is usually not enough-unless it’s integrated with transformation (like canning after sterilization).
Why this matters in practice:
- Stats and surveys: Governments classify firms to measure GDP, productivity, and employment. You’ll see the code on official surveys and business registers.
- Grants and tax: Manufacturing can open doors (capital grants, accelerated depreciation, R&D support) or obligations (safety, environmental permits).
- Safety and environment: Factories face specific rules on noise, hazardous substances, and worker safety. Classification signals which rulebook you’re under.
- Trade and customs: “Substantial transformation” is a key test for origin claims in trade agreements. Your process may determine if your product qualifies as “made in X.”
Country snapshots (what agencies actually say):
- United States (NAICS 2022, Sectors 31-33): “Physical or chemical transformation of materials, substances, or components into new products.” Includes assembly of components. Excludes construction and most installation. Source: U.S. Census Bureau/OMB NAICS manual.
- United Kingdom (SIC 2007, Section C): Mirrors EU NACE. Manufacturing is the transformation of materials into new products, including assembly and processing. Source: ONS SIC 2007.
- European Union (NACE Rev. 2, Section C): Same core definition; includes repair of fabricated metal products and machinery in some classes; distinguishes from construction and services. Source: Eurostat NACE.
- Australia and New Zealand (ANZSIC06, Division C): “Physical or chemical transformation of materials, substances or components into new products.” Includes assembly, excludes on-site installation classified under construction. Source: ABS/Stats NZ ANZSIC06.
- India (NIC 2008, Section C): Follows UN ISIC. But India’s Factories Act broadens “manufacturing process” to include finishing, packing, printing, power generation, and more. DPIIT’s FDI policy treats “contract manufacturing” as manufacturing if done in India (own or contract plant). Sources: NIC 2008; Factories Act 1948 Sec. 2(k); DPIIT FDI Policy.
Examples and edge cases across countries
These are the tricky calls people trip over. I’ll label the likely classification and why, and flag where countries may differ.
1) Bakery
- Wholesale bread plant shipping to supermarkets: Manufacturing (NAICS 3118; ANZSIC C117; NACE C10.71). You’re transforming flour into bread at scale.
- Small retail bakery with on-site baking for walk-in sales: Often retail with in-house production (NAICS 445291). Some countries still classify this as manufacturing if wholesale is significant.
- Cloud kitchen baking cakes to order for delivery: If you primarily produce packaged goods and do not serve on site, expect manufacturing or food production classification in some systems; where food service dominates, it can swing to services. Local rules vary a lot here.
2) 3D printing shop
- You design and print custom parts in plastic/resin/metal, then ship: Manufacturing. Transformation is the whole point.
- You print one-off prototypes for engineers and hand over files and prints: Still manufacturing for the printing part; the design consulting portion is services. You might split revenue across codes.
3) Electronics assembly
- PCB assembly (SMT), box-build, testing: Manufacturing (NAICS 334; NACE C26; ANZSIC C2421/C2422). Assembly is explicitly included.
- Firmware development only, no boards built: Not manufacturing; that’s software/engineering services. If you both build boards and write firmware, you’re a manufacturer with an R&D function.
4) Furniture
- Cutting timber, machining, assembling, finishing chairs: Manufacturing (NAICS 337; ANZSIC C251). Clear transformation.
- Flat-pack import, minor drilling, and resale: Typically wholesale/retail unless the work is substantial. Drilling a few holes is not manufacturing in most systems.
5) Metalwork and fabrication
- Laser cutting, bending, welding parts to prints: Manufacturing (NAICS 332; NACE C25). Custom job shops are included.
- On-site structural steel erection: Construction, not manufacturing (even if you fabricated the steel elsewhere). You may have two units: a fabrication plant (manufacturing) and a site crew (construction).
6) Food and beverage
- Brewing, distilling, winemaking: Manufacturing (NAICS 312; NACE C11). Fermentation is transformation.
- Coffee roasting and packaging: Manufacturing (NAICS 31192). Coffee shop brewing drinks for immediate consumption is food service.
7) Packaging and labeling
- Repacking bulk goods into retail packs with no processing: Often wholesale/logistics, not manufacturing, unless your country’s law (e.g., parts of India) treats certain packing steps as a “manufacturing process.”
- Packaging integrated with processing (sterilizing, canning, nitrogen flushing): Manufacturing, because processing changes product condition and shelf life.
8) Repair, refurbishment, and reman
- Repairing machinery back to working order: Often classified under “repair and installation of machinery and equipment” (NACE C33/NAICS 811). In some systems, heavy remanufacturing that restores to “like-new” with substantial parts replacement can fall under manufacturing.
- Cosmetic refurb of consumer goods: Usually repair or retail, unless transformation is significant.
9) Software with hardware
- You sell a smart device you assemble and ship; software is embedded: Manufacturing for the product; software is part of the value, but the output is tangible.
- SaaS controlling third-party devices, no tangible output from you: Not manufacturing; that’s software/services.
10) Printing and publishing
- Printing newspapers, labels, packaging: Often classified as manufacturing in many systems (e.g., NAICS 323). The India Factories Act specifically lists printing as a manufacturing process.
- Digital-only publishing: Not manufacturing; it’s information services.
11) Construction products
- Precast concrete plant making beams off-site: Manufacturing (product leaves your plant). On-site pouring and casting: Construction.
- Cabinet shop building kitchens in a workshop: Manufacturing. Installing them on site: Construction services-usually a separate code.
12) Energy and chemicals
- Refining, blending fuels, chemical synthesis: Manufacturing (NAICS 324/325; NACE C19/C20).
- Generating electricity: Often its own sector (utilities) but in India, “generating, transforming electricity” appears in the Factories Act’s “manufacturing process”-that matters for safety and labour law, even if statistical codes put generation under utilities.
Checklists, cheat sheets, FAQs, and next steps
Here’s a compact toolkit you can actually use.
Quick classification checklist
- Product: Do you sell a physical product you make?
- Transformation: Do inputs become a new good with a new name, character, or use?
- Main activity: Is that transformation your core revenue?
- Location: Does it happen at your plant/workshop, not mainly on a building site?
- Code match: Can you match your activity to NAICS 31-33 / SIC Section C / NACE Section C / ANZSIC Division C / NIC Section C?
- Local twist: Any local law (e.g., Factories Act in India) that broadens or narrows the scope for permits, safety, or benefits?
Heuristics and rules of thumb
- If you could write “We make X” and ship it, you’re likely a manufacturer.
- If your output is “We install X at your site,” you’re likely construction or a service, even if you fabricate components somewhere.
- If your work is small customization on a bought-in product, it’s usually not manufacturing unless the customization is complex and changes the function.
- 3D printing that creates the final product is manufacturing; 3D printing fixtures to help your own service work doesn’t turn your business into manufacturing.
Common pitfalls to avoid
- Assuming any workshop = manufacturing. A repair shop is a workshop, but it’s not always manufacturing by code.
- Overstating “packaging as manufacturing.” Pure repack is rarely enough outside of special cases.
- Ignoring split activities. Many firms have both a manufacturing unit and an installation/retail unit; classify each correctly.
- For grants: Relying on the broad statistical definition only. Always read the program’s specific eligibility wording.
Mini-FAQ
- Does assembly count as manufacturing? Yes, when you assemble components into a new product. All the major systems say so.
- Is software development “manufacturing”? No, unless it’s part of producing a physical device. Pure software is information/services.
- Is contract manufacturing still manufacturing for me? If you own the product and direct the process, governments often still treat your firm as a manufacturer for some policies. But the plant operator is definitely classified as manufacturing. India’s DPIIT explicitly recognizes contract manufacturing as “manufacturing” if done in India.
- We make to order only. Are we manufacturers? Yes. Custom/job shops are still manufacturers in NAICS, NACE, ANZSIC, SIC, and NIC.
- We install what we make. What’s our code? You may need two codes: one for the factory, one for installation (construction/repair). Many business registers allow multiple activities.
- We refurbish used gear. Manufacturing or repair? Light repairs are repair. Full remanufacturing to “like-new” with substantial parts and processes can fall under manufacturing in some systems. Check the specific code notes for your country.
Country-by-country cheat sheet (what to search, what to expect)
- United States: Search “NAICS 31-33 Manufacturing 2022.” Expect a chapter intro defining transformation; look up industry-specific examples (e.g., 311 for Food, 332 for Fabricated Metal).
- United Kingdom: Search “UK SIC 2007 Section C Manufacturing.” Read section notes and subclass examples to place your activity.
- European Union: Search “NACE Rev. 2 Section C.” Eurostat’s notes help with borderline cases like repair vs manufacturing.
- Australia/New Zealand: Search “ANZSIC06 Division C Manufacturing.” Stats NZ and the ABS have readable guides. In NZ, councils and Stats NZ rely on these codes.
- India: Search “NIC 2008 Section C” for stats; also “Factories Act 1948 Section 2(k)” for the broader manufacturing process list; and “DPIIT FDI Policy manufacturing” for the contract manufacturing stance.
Decision tree (text version)
- Is your output a physical good you created? If no → Not manufacturing. If yes → go to 2.
- Did you transform inputs into a new product with a new use? If no (minor changes only) → Likely not manufacturing. If yes → go to 3.
- Is that transformation your main business activity? If no → classify under the main activity. If yes → go to 4.
- Does most work happen in your plant/workshop? If yes → Manufacturing. If no, it’s likely construction/service; your plant work may still be a separate manufacturing activity.
When the answer changes by country (watch-outs)
- Packaging-only operations: Often logistics/wholesale in US/EU/NZ; can be treated as a “manufacturing process” under India’s safety law context.
- Retail bakeries: Some systems code as retail with in-house production if walk-in sales dominate; others look at wholesale share.
- Repair vs reman: The EU’s NACE offers clearer remanufacturing guidance in some classes; NAICS tends to keep repair separate.
Why your code might differ from your neighbor’s (even with the same machines)
- Different main revenue mix (one sells mainly installation, the other ships products).
- Different legal structure (one runs the plant; the other is a design or brand company outsourcing production).
- Different national code notes and updates (NAICS 2022 vs older versions; local interpretations).
Credible sources to cite in forms and proposals
- United States: NAICS Manual 2022, Sectors 31-33.
- United Kingdom: UK SIC 2007, Section C notes from ONS.
- European Union: NACE Rev. 2, Section C from Eurostat.
- Australia/New Zealand: ANZSIC06 Division C from ABS/Stats NZ.
- India: NIC 2008 Section C; Factories Act 1948 Section 2(k); DPIIT FDI Policy (contract manufacturing).
Next steps (pick your situation)
- Small manufacturer unsure of code: Read your country’s manufacturing section preface (5-10 minutes). Then pick the specific subclass that matches your product (e.g., 3118 for bakeries in NAICS). Note any secondary activities (installation, retail) and keep separate accounts if possible.
- Startup considering grants: Check program eligibility words. Some grants require a minimum share of revenue from shipped products or exclude simple assembly. Keep process notes and photos-being able to show “transformation” helps.
- Contracting to factories (brand owner): You’re likely a manufacturer for policy and trade labeling if you own the product and control specs, but the factory itself is the manufacturing establishment. Contracts should state who does what to avoid confusion in audits.
- Service shop moving into products: Spin up a separate product code and cost center. This makes it easier to claim manufacturing-linked incentives and meet reporting duties without mixing service revenue.
- Students and analysts: Map company activities to a code set (NAICS/NACE/ANZSIC/NIC). When the activity is mixed, document the share of revenue/time by activity-that’s how statistical offices do it.
Troubleshooting
- My activity seems half-and-half (manufacturing and service). What do I do? Classify by the largest share of value added or revenue. If both are material, use multiple codes-primary and secondary.
- Authorities keep pushing me into the wrong bucket. Bring a one-page brief: what you make, the steps of transformation, where it happens, and two or three specific code references from your country’s manual. Clear beats long.
- I need the broadest possible definition for a permit. In India, cite the Factories Act’s Section 2(k). In other places, stick to your statistical code and the process description; don’t over-claim.
- We outsource all production offshore. Are we still manufacturers? For stats at home, likely not-you’re a wholesaler/brand owner unless you also run a domestic plant. For customs and origin, the offshore process determines “manufacturing.”
- Our council asked our ANZSIC code (NZ/AU). We cut, assemble, and finish wood furniture in a workshop in Auckland; we also install kitchens. Use ANZSIC C251 (manufacturing) for the workshop and note E324 for installation as a secondary activity if needed. Keep the two activities distinct in records.
One last sanity check
- Do you transform inputs into a new, tangible product at your place? Yes → You’re probably manufacturing.
- Do you mainly install, repair, or sell what others made? That’s usually construction, repair, or retail/wholesale.
- When stuck, read your Section C notes (NAICS/SIC/NACE/ANZSIC/NIC) and match your process to listed examples.
Sources named for credibility
United States: NAICS Manual 2022, Sectors 31-33 (U.S. Census Bureau/OMB). United Kingdom: Standard Industrial Classification 2007, Section C (ONS). European Union: NACE Rev. 2, Section C (Eurostat). Australia/New Zealand: ANZSIC 2006 (Revision 2.0), Division C Manufacturing (ABS/Stats NZ). India: National Industrial Classification 2008, Section C; Factories Act 1948, Section 2(k); Department for Promotion of Industry and Internal Trade (FDI Policy, manufacturing and contract manufacturing). These are the authoritative anchors agencies use in 2025.