OEM and ODM - The Secret of World Renowned Brands [Part 1]

2개월 전


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INTRODUCTION

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When you think about some tech giants in the world today, I'm talking Apple, Samsung, LG, Lenovo, Dell, and some others, one of the things that come to mind is - these guys are huge companies manufacturing great products. A lot of people don't even think of entering into the tech space because most of them think "it's gonna take a whole lot". Well, while that may make sense, it's not totally true. Let me explain with these points -

  • What is OEM and ODM
  • How does it all work
  • Ok, If I'm interested, what do I do?

WHAT IS OEM AND ODM

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O E M is an acronym that stands for Original Equipment Manufacturing though, in some context, the 'M' may denote 'Manufacturer'. They are sometimes referred to as contract manufacturers because of how they function. Some examples are Foxconn (manufacturers of apple products), Intel (renown computer chip manufacturer), etc.

O D M is an acronym that stands for Original Design Manufacturing though, in some context, the 'M' may denote 'Manufacturer'. This is the owner of the product design, the one who contracts the manufacturer to produce a product they designed. Some renowned examples are Samsung, Apple, Lenovo, LG, Addidas, etc.

HOW DOES IT ALL WORK

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Usually, the O D M spends their time and resources coming up with designs of their products. They have the specifications and are responsible for what the product turns out to be.

After they are through with the design, they search for a contract manufacturer of due capability. This is the O E M that has the man-power and resources to manufacture products in VERY large numbers.

Let's take an example shall we?

Ok then, let's consider Addidas.

Usually, Addidas outsource most of their production. On their website, they even stated it -

adidas has outsourced most of its production. Overall, we work with around 800 independent factories from around the world that manufacture our products in more than 55 countries.
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Also, from the website, you can find a list of OEMs that they used during the FIFA 2018 World Cup. Here is the link to a pdf containing the list - link here

Another example is Apple. Apple designs the products, but the manufacturing is done by Hon Hai Precision Industry Co., Ltd. The trade name of this company is - Foxconn Technology Group

The ODM contracts the OEM to mass-produce products designed by the ODM for the ODM. The OEM isn't the owner of the product, the ODM is. However, you might see a little footnote somewhere on the product saying where the product was made, this is usually the location of the OEM eg "Made in China"

For the records, you can find lots of OEMs in China.

OK, IF I'M INTERESTED, WHAT DO I DO?

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If you're interested in getting something OEMed for you, here are some things you might want to do.

1. Take your time to design your product.

You need to take your time and design a very good product. It may not cost you much to learn how to design using some CAD (Computer Aided Design) software but even if it does, you could get someone to do the designing. To get a very good product, you might want to meet with experts and ask questions and more importantly, learn the intricacies of the product.

2. Source for an OEM

"Welcome to China!"

Said one man on an ad I watched years ago.

Well, he may not have been welcoming ODMs but ODMs surely are welcomed in China. Why? They are lots of manufacturers there. From Guangdong to Shenzhen and to Nanchang, there are lots of factories that can give you what you will like.

When Sourcing for manufacturers, I usually prefer alibaba.com. There are lots of OEMs there and they give insanely cheap prices + they can legit OEM almost anything for you even if it's another person's design eg. a rolex wristwatch. I'm not saying you should do plagiarism, no, we don't do that in project hope.

CONCLUSION

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OEM and ODM are important parts of manufacturing, sharing the responsibilities of production among different organizations. With these, one can focus on designing products and sourcing for manufacturers rather than giving up on their dream to be a manufacturer.

I won't know what else to write about this part of OEM and ODM if you don't tell me in the comment section. See you in the second part.
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Worthy mentions:
@steemcurator01
@trafalgar
@crypto.piotr

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