Industrial

The term "Industrial" is used broadly to refer to any activity aimed at generating goods or services. Due to its broad nature, it is important to specify the concept based on the context. Therefore, the identifiable Business Models within the Industrial sector can be categorised as follows:

• Extractive: This industry engages in processes for the extraction of raw materials intended for consumer use;
• Manufacturing and/or Transformation: This industry is dedicated to commercial activities involving the use of machinery, tools, and labor to convert raw materials into sellable goods;
• Mechanical and Metalworking: These are productive activities aimed at producing components or final goods made of metal or the manufacturing of machinery for the production of final goods;
• Automotive: This industry specialises in the design, construction, and sale of motor vehicles;
• Components and Electronics: This branch of the manufacturing industry focuses on the production of components and electronic products for other industrial and commercial sectors, as well as for direct consumer use.

Compared to most market sectors, especially in Italy where small and micro-sized businesses prevail, the Industrial sector is predominantly characterised by large and long-standing companies. The sector is less fragmented and highly competitive. This also results in significant entry barriers of an economic and technological nature, limiting the access for new enterprises. In terms of performance and results, the Industrial sector is cyclical and highly influenced by the overall course of the economy. Additionally, in recent years, there has been an increasing trend of geographic relocation of Italian industrial production facilities to foreign countries.

Being highly susceptible to PEST factors (political, economic, social, and technological), it is common to observe fluctuations in value (in terms of production and revenue), transformations in production processes, and evolutions in the utilisation of facilities and machinery in the supply chain. Examples of PEST phenomena that have led to such events include:

• The Covid-19 pandemic in the period 2020-2021;
• The Digital Transformation;
• National and European regulations regarding safety.

The Industrial sector is undergoing significant evolution, providing investors with opportunities to diversify their portfolios based on emerging market trends. The rapid and growing digitalisation of the sector, which has led to the emergence of Industry 4.0, is driving the use of technologies such as:

• IoT (Internet of Things): In the industrial context, these technologies are applied to machine control, construction or plant operations (examples include Smart Factories, predictive and remote maintenance, rapid measurement, and industrial HVAC);
• 3D Printing: Used for producing plastic prototypes, structural parts for civil applications, direct use of metal parts in final products, and biomedical and aerospace applications;
• Robotics: Refers to the automation of human labor along assembly lines, particularly in palletising and storage, mostly in challenging and hazardous work areas. It ensures a consistent work pace while also protecting human health;
• AI (Artificial Intelligence): Through algorithm development and the assistance of computational linguistics, AI provides benefits in industrial decision-making processes, product design phases, industrial space management, and labor acceleration.

Furthermore, other rising trends include:

• Modularity and adaptability: The ability to adjust production processes and machinery to manufacture various goods and commodities that cater to different needs;
• Focus on environmental sustainability throughout the different stages of the production processes.