Fabrication, when used as an industrial term, applies to the building of machines, structures and other equipment, by cutting, shaping and assembling components made from raw materials. Small businesses that specialize in metal are called fab shops.
Steel fabrication shops and machine shops have overlapping capabilities, but fabrication shops generally concentrate on the metal preparation, welding and assembly aspect while the machine shop is more concerned with the machining of parts.
Metal fabrication is a value added process that involves the construction of machines and structures from various raw materials. A fab shop will bid on a job, usually based on the engineering drawings, and if awarded the contract will build the product.
Fabrication shops are employed by contractors, OEM's and VAR's. Typical projects include; loose parts, structural frames for buildings and heavy equipment, and hand railings and stairs for buildings.