Market vs Industry
The difference between market and industry becomes clear when you understand what each term stands for. However, there are certain similarities between the two that create the confusion. Nevertheless, we can say that while the words market and industry have many things in common, they are not synonyms. Now, you go to market, to buy things or items you require for various needs, don’t you? The same cannot be said about the industry, isn’t it? There are many differences between market and industry that will be made clear to all those who remain confused and sometimes use these terms interchangeably. Before we go into the details of the differences between market and industry, let us discuss the two terms separately.
What is Market?
Market is a place where buyers and sellers connect. Let us see how this happens. A market is a large place where there are both sellers as well as buyers exchanging goods and services. There are retail markets like malls and supermarkets, and there are wholesale markets for commodities, and there are online merchandising too. There are even stock markets. Thus, a market is a place where large numbers of sellers have their products for sale, and there are buyers to buy these products. In other words, it is a place of buying and selling merchandise.
It is interesting to note that market also refers to a population of buyers or consumers of a specified commodity. A market best exemplifies the golden rule of demand and supply. It is a place where there are sellers (suppliers) and buyers (those creating demand) exchanging goods and money. Sellers get money for goods whereas buyers get goods for money.
What is Industry?
An industry is one or more companies that produce similar products. Talking more about industry, it is common to refer to entire markets around the world or in a country, in the same business as industry. So we have coal industry, cement industry, IT industry, and so on. You can see that each of these industries is a combination of companies that produce the same product. If you take, cement industry, there can be different companies with different names. However, they all produce the same product, which is cement. So, when we take all of these companies together, we call them an industry. Thus, industry is a generic or umbrella term that is used to describe a particular business activity around a country, or the world.
You can make policies about a particular industry such as taxation and encouragement, and you can have agreements and investments in a particular industry. So, in short, an industry refers to the sum total of companies engaged in the same kind of business and in fact competing with each other. It would be correct to say that this competition within the industry arises as an industry is a collection of companies involved in making a similar type of products.
What is the difference between Market and Industry?
• Definition of Market and Industry:
• Market is the place where buyers and sellers connect with each other.
• Industry is one or a group of companies that produce the same product.
• Other meanings:
• Market also is a reference to a population of buyers or consumers of a specified commodity.
• Industry does not have any other meaning.
• Tangibility:
• A market can be an exact geographical place like a mall or a shop that you can visit. However, it can also be an intangible place like an internet market. You cannot physically visit such a market.
• Industry normally exists physically as these companies produce some kind of a product.
• Variety of Goods and Services:
• A market has a number of different goods.
• An industry produces one type of good. For example, textile industry means all the companies in that industry produces textile.
• Demand and Supply:
• A market exists following the demand and supply. Market shows both demand and supply powers.
• An industry also exists because of demand and supply. However, they only show the supply power.
• Competition:
• The competition in a market is between different sellers and different buyers. Every seller is trying to sell his product better than the other seller. Every buyer is determined to buy the best product available within his or her buying capacity.
• Competition in the industry exists between the companies that create the industry to produce the best product.
Images Courtesy:
- Borough Market cake stall by
- A power plant in Tianjin – Energy Industry by Shubert Ciencia (CC BY 2.0)
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