LOGistICAL - Sublime Logistical Strategy Puzzling

Can anyone explain why, when I’ve got an industry to three stars and I’m able to build it in another city, sometimes there’s a limit on the level or size of that industry that I can build. Are these limitations just arbitrary limits for that particular city, or are they based on something? What does the size value even mean? Is it the cap on what can be produced and stored at one time, which then is increased by star-level along with the efficiency of production?