The term factory has been applied customarily to manufacturing units with the following characteristics:
1. A substantial output of a standardized product made to be sold in a wide, rather than a strictly local, market.
2. Complex operations carried on in one building or group of adjacent buildings. A considerable investment in fixed plant, the mechanization of processes, and the use of power are implied.
3. An assembly of workers under a definite organizational discipline.
In the United States, the factory developed first in the cotton textile industry. The mill of Almy, Brown, and Slater, in operation by 1793, is usually considered the first American factory. Moses Brown and William Almy were men of wealth in the New England mercantile tradition. Like many other American enterprisers, they had tried and failed to duplicate English spinning machinery. In 1789, a young mechanical wizard, Samuel Slater, came to Rhode Island after working for years in the firm of Arkwright and Strutt in Milford, England. Having memorized the minutest details of the water frames, Slater joined with Almy and Brown and agreed to reproduce the equipment for a mechanized spinning mill. Although small, the enterprise served as a training ground for operatives and as a pilot operation for managers.
A number of small cotton mills like the Slater mill soon followed, but most failed by the turn of the century because their promoters did not aim for a wide market. Not until the Embargo Act of 1807 and the consequent scarcity of English textiles that stimulated demand for domestic manufactures did spinning mills become numerous. Between 1805 and 1815, 94 new cotton mills were built in New England, and the mounting competition led Almy and Brown to push their markets south and west. By 1814, 70 percent of all consignments were to the Midwest via Philadelphia. Only two decades after Arkwright machinery was introduced into this country, the market for yarn was becoming national, and the spinning process was becoming a true factory operation as it was in England.