OEM Manufacturing

All you need to know about Original Equipment Manufacture

An OEM (Original Equipment Manufacturer) is a company that manufactures products which are to be purchased by a second company and retailed under the brand of that second company.

This allows the purchaser to concentrate on their core strengths of sales, marketing and sometimes concept design and the OEM manufacturer to complement those strengths by bring their own expertise to the table. It’s also a great way for companies that want branded products to avoid major investment in plant and additional workforce, including expensive engineers and project managers.

This is a very common arrangement, particularly in the consumer digital electronics market place. As an example, there are only four remaining hard-drive manufacturers (and if current merger plans are approved, there may be only three or even two) but many different hard-drive brands on the market, and that doesn’t include all the incidences of a hard-drive being included as part of another device and sold under yet another brand name.

When would I need an OEM Manufacturer?

There are a many reasons for engaging the services of an OEM manufacturing company but some of the more common ones are:

  • To effect a quick market entry in an already developed sector – for example if you want to enter the MP3 player market, instead of developing a brand new product from scratch it may be easier to test the waters with an already tried-and-tested product and re-brand it for your company than to develop a product from scratch. This is a good way to enter a market that’s just taking off before the major players are fully established and can bring long-term competitive benefits.
  • For “giveaways” or promotional events – if you only need a very small quantity this won’t be the most cost-effective solution and a marketing consultancy would be able to add your logo to pre-purchased pieces, but if you’re looking at quantities in the thousands to millions range (depending on the type of giveaway these numbers can both be workable) then having your product custom manufactured can reduce costs and ensure exclusivity.
  • For the long-term benefits; a good OEM manufacturing partner won’t see you as a “one-off” customer (unless that’s exactly the relationship you want because you need something made as a “one off”) they’ll keep an eye on your product and offer solutions to increase its market life, quality and of course costs over time because it’s in their interests for your products to remain competitive and appealing to your customers

SZCEIT are experts at helping companies outsource their OEM manufacturing in China, getting the right results every time to give you freedom to manage your core business and the certainty of quality products at the right price every time.