Before the development and growth of factories across Great Britain, domestic industry had been common throughout the land. As factories caused this to rapidly decline, Lancashire found that it had a skilled workforce already in the area as prior to the Industrial Revolution, Lancashire had been famous for the number of people who worked in its woollen industry. This workforce was already skilled in spinning and weaving.
The port of Liverpool was already importing raw cotton from Turkey and the Middle East. As the cotton industry grew, Liverpool found that it was ideally situated – on the west, Atlantic facing coast - to import cotton from the plantations that were developing in the southern states of America.
Fast flowing streams were required as a source of power and the water that flowed off of the Pennines into Lancashire was perfect for this. It was also soft water so it was perfect for washing the cotton.
Lancashire also had a damp climate that was useful in the cotton factories as it stopped the cotton thread from drying out and snapping when it was under strain.
The cotton industry was new to Lancashire and it attracted to it new entrepreneurs such as Richard Arkwright who had new ideas that acted as a stimulus for the industry. By comparison, the woollen industry, which had been around for much longer, was more conservative in its outlook and less inclined to adopt new methods of working.
The centuries of tradition within the woollen industry was also a disadvantage as it was stymied by centuries old rules introduced by guilds in the Middle Ages. These rules defended quality and the rights of weavers but they were not of any value to an industry moving into the Industrial Revolution.