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A by product may be a secondary unit produced during a joint production process that has little value in reference to the most product being produced. In other words, it’s a unit that is created inadvertently during the process of manufacturing another product.

Example: Byproducts occur in almost all industries not just manufacturing. Take farming for example. Dairy farmers breed and lift cows to supply milk so as to sell it to grocery stores, restaurants, and distributors. What is a byproduct of cattle? Manure. The farmer isn’t trying to start a manure farm. He or she is interested in producing milk, but the manure is created during the process.

The manure doesn’t have the same value that the milk does, but it does still have value. Farmers typically sell manure to landscapers or fertilizer companies that process the waste into fertilizer for farms, greenhouses, and residential gardens. There are numerous other processes that make useful by products.  

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