To simplify: carpet is the raw material and an area rug is the finished product. Carpet is an unfinished fabric made on a loom. These materials are typically manufactured 12’, 13’2”, 15’, or 16’4” wide. From this material, a few products can be made. It can be installed wall to wall or can be made into area rugs or runners.  The process simply requires a clean cut and a finished edge which we typically call “binding” or “edging.” The process of turning broadloom carpet into rugs and runners is called “fabrication.”