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Downstream in manufacturing refers to processes that occur later on in a production sequence or production line.
Viewing a company "from order to cash" might have high-level processes such as Marketing, Sales, Order Entry, Manufacturing, Packaging, Shipping, Invoicing. Each of these could be deconstructed into many sub-processes and supporting processes.
The Manufacturing process consists of such sub-processes as Design, Tooling, Inventory Management, Receiving, Assembly, and others. The products being manufactured are created in a sequence of processes. Any process occurring after another is considered to be downstream.