The factory system is a method of manufacturing using machinery and division of labour. Because of the high capital cost of machinery and factory buildings, factories were typically privatized and owned by wealthy individuals who employed the operative labour. Use of machinery with the division of labour reduced the required skill level of workers and also increased the output per worker.
The factory system was first adopted in Britain at the beginning of the Industrial Revolution in the late 18th century and later spread around the world.[1] It replaced the putting-out system. The main characteristic of the factory system is the use of machinery, originally powered by water or steam and later by electricity. Other characteristics of the system mostly derive from the use of machinery or economies of scale, the centralization of factories, and standardization of interchangeable parts.
