OEM stands for Original Equipment Manufacturing, and refers to products that are fully designed by one company and then licensed out to a manufacturer to produce. The Apple iPhone, for example, was invented and designed by Apple, and then licensed out to Foxconn to produce. As a result, the iPhone enjoys a higher level of product differentiation because its design is only available to Apple and its licensed manufacturer.
Hengkang supply professional and honest service.
Many other brand name electronics and appliances are OEM. Custom designed clothing, as opposed to a generic garment with a custom logo, is another example of OEM.
The main advantage of OEM is that the designer retains total creative control over the design. Whereas ODM products are restricted to a predetermined design, OEM products can be made according to any specifications. The only limitation is the designer’s imagination (as well as budget).
The disadvantage of OEM manufacturing is that it is much more resource intensive. OEM designers often invest millions of dollars into research and development over several years in order to create unique products. Because of this, OEM designers have to guard their designs as intellectual property, lest it be copied and sold by another company for a lower price.
When it comes to contracting a manufacturer, there are two main options: OEM and ODM. Regardless of where companies are outsourcing their manufacturing operations, many of their suppliers are usually either OEM or ODM. As such, if your business is planning to get a product produced, understanding the difference between the two manufacturers, including the pros and cons of each, are essential in choosing the right partnership and ensuring you have a successful start on your new project. That’s why in today’s AVer Experts, we will be looking at the fundamentals of both business solutions and help you make a more informed decision on which type of manufacturer you should pick.
The first type of manufacturer is OEM, which stands for Original Equipment Manufacturer. It is a manufacturing business model in which the contracted company/supplier develops and produces the product based on a design from the buyer. This means once you have the finalized product design, you can proceed to contract an OEM, who will provide the labor and expertise to begin production. Essentially, you can think of them as the handyman to your business operation – you provide the ideas, and they provide the equipment and experience.
Want more information on Powder Supplement Oem Odm? Feel free to contact us.
There are several advantages to contracting an OEM, including creative control, mature supply chain, and cost efficiency. Generally speaking, an OEM will have an established supply chain that allows them to provide the necessary components needed for the buyer’s specifications, thus reducing the development of production time. Working with an OEM is also relatively cost-efficient because of the increasing demand for business solutions sought by startups and established corporates alike. As a result, the competitive service rates allow OEM companies to offer their services at a lower rate. The biggest benefit of contracting an OEM, however, is the greater freedom of customization you’d have in the product design. But due to the bigger creative control, an OEM project would also require more input and time commitment from the buyer as the supplier won’t interfere with anything that involves the patents or designs.
ODM, on the other hand, is an abbreviation for Original Design Manufacturer. As the name suggests, ODM is a business model that produces the design and the final product. Therefore, they operate as both the designers and manufacturers, but allow the buyer/customer to make slight changes to the products. Alternatively, the buyer may also purchase prototypes that are made available by the suppliers and make small alteration requests to the existing design before selling it as a rebranded product.
One of the main advantages with an ODM model is the low product development costs; since ODM develops their own design and manufacture accordingly, they do not require much in terms of technical input. Subsequently, the speed to market interval is also generally shorter than that of OEM, allowing companies to save time on project development. Additionally, choosing a reliable ODM means lower risk of the product being faulty or copied since they will already have the necessary licenses and conducted thorough assessments on the prototypes. The minimum order quantity is also normally lower with ODM compared to OEM services due to existing prototypes/products that are being sold to various customers. However, as the intellectual property of the product usually belongs to the supplier, the buyer’s creative control is generally more limited.
So now that you know the difference between OEM and ODM, let’s go over some of the important factors to consider when deciding which manufacturer to contract. The first is the sensitivity of your intellectual property (IP). If you hire an OEM, the IP belongs to the buyer in most cases since you are usually the one that would be providing the product design and be involved in the development process. However, if you choose ODM, the product design, as well as tooling and other IP, will be owned by the supplier (unless otherwise contracted). The second factor is the complexity of your product and how distinct you’d want it to be from the crowd. Depending on your preference, you may prefer to have a higher level of customization by choosing OEM, or you may prioritize the speed to market efficiency and focus on marketing by going with ODM. Aside from that, it’s also important to consider the quality and reliability of your chosen manufacturer since not all manufactured products will have the same quality. It’s also common for manufacturers, whether it be OEM or ODM, to specialize in a specific type of product. Hence, irrespective of your preferences over the manufacturing processes, it would be wise to contract a supplier that has strong expertise in the specific product market you’re interested in.
Here at AVer, we have a versatile research and development team with a wealth of experience that is dedicated to product design and innovation, offering both OEM and ODM services worldwide. Thus, if your business is looking for an OEM or ODM partner that is specialized in education technology, business communication, or retail technology products, AVer would be an ideal choice of supplier to consider.
The company is the world’s best custom DHT blocker gummy supplier. We are your one-stop shop for all needs. Our staff are highly-specialized and will help you find the product you need.