Harvard Business School identifies textile and garment production, food production, rope making, candy making, watch making, manual labour, and carpet weaving as examples of cottage businesses in which a small number of workers operate from home. Although these businesses were significant during the colonial era in the United States, they remain significant in developing nations and rural areas that cannot afford to employ large numbers of workers in factories.
Cottage industries are uncommon because they struggle to compete with the lower costs associated with mass production, according to Investopedia. Developed nations typically have the financial means to mass create goods in factories. During colonial times, households produced clothing, food, and other items in their houses to support themselves, as industrialization had not yet led to mass production. Home-visiting vendors were a common source of raw materials for sewing and household production for local families.