What ARE Original Design Manufacturing and Original Equipment Manufacturing?
There are so many different facets to the supply chain. Have you ever wondered how companies manufacture their products, or thought about how branding/design ends up on similar products?
OEM stands for Original Equipment Manufacturing.
This is when your company design its own product and hosts its logo on the product but outsources the manufacturing of the designed product. This cuts down on costs for the company. For example, Samsung designs its products and then outsources manufacturing of its goods to other companies. Samsung does not have to pay for the land and factory operations costs, training of manufacturing staff, and other costs associated with manufacturing.
The main advantage of OEM is that the designer retains total creative control over the design and you’re not going to end up with the same product as a competitor.
ODM stand for Original Design Manufacturing.
This is when a manufacturing company already has a product of their own making and sells to retails outlets or other organizations who stamp their own label and branding on the product.
ODM white label is where the ODM designs, manufactures, distributes non-label, generic FGI products to various outlets or retailers. These retailers then sell the ODM product under their own logo or brand name. Examples of this include phone cases and chargers.
Many companies sign ODM private contracts in which companies will manufacture goods but for one company ONLY. For example, a private contract might be a manufacturing company that makes phones and tablets for Samsung ONLY.
The advantage of ODM is that product design already exists! There’s no need to reinvent something, and again, choosing this route can save your company time and money. The disadvantage of ODM is that it can be more difficult to differentiate your product from competitors’ products that are manufactured according to the same design
We have relationships (and continue to develop partnerships) with various manufacturing companies to offer YOUR brand the choice of both ODM and OEM services. Have something you want designed? Let us help you find a manufacturer! Have a solid brand but looking for more product to carry? Let our in-house graphic designers and sales team help you to make this a reality! Learn more.
We hope this helps clarify some of the differences between the two, and offers insight into your next step at your business!