Which term refers to industries that must locate near customers to reduce transport costs because their products gain weight during production?

Which term refers to industries that must locate near customers to reduce transport costs because their products gain weight during production?

• A. bulk-losing industries
• B. service industries
• C. bulk-increasing businesses
• D. light manufacturing

Answer: (C)

The key idea is how weight changes during production affect transport costs. When a product becomes heavier as it’s produced, moving the final, heavier product to customers is costly. To cut those transport costs, such industries locate close to the market where the product will be sold. This is why the term bulk-increasing (also called bulk-gaining) fits: processing adds mass, so you want to be near customers to avoid shipping a heavier finished product. If a product lost weight in production, you’d typically locate near raw material sources, since you'd be moving heavier inputs to the factory and lighter finished goods to the market. Service industries aren’t defined by weight changes, and light manufacturing isn’t specifically about weight gain in production.

The key idea is how weight changes during production affect transport costs. When a product becomes heavier as it’s produced, moving the final, heavier product to customers is costly. To cut those transport costs, such industries locate close to the market where the product will be sold. This is why the term bulk-increasing (also called bulk-gaining) fits: processing adds mass, so you want to be near customers to avoid shipping a heavier finished product.

If a product lost weight in production, you’d typically locate near raw material sources, since you'd be moving heavier inputs to the factory and lighter finished goods to the market. Service industries aren’t defined by weight changes, and light manufacturing isn’t specifically about weight gain in production.