This factory implementation maintains a shared count across all created objects: 1) The outer IIFE creates a closure containing the peopleCount variable, 2) Every time createPerson is called, it increments the same peopleCount, 3) This enables auto-incrementing IDs that are guaranteed to be unique, 4) The counter state persists between factory calls but is not accessible externally, 5) This pattern creates a private shared state for the factory function, 6) It's useful for creating objects that need coordinated unique identifiers or tracking metadata.