Original Equipment Manufacturer OEM Definition, Example, Benefits

By collaborating with an OEM, companies can address this limitation by sourcing the necessary components from the OEM and seamlessly integrating them into their own products. A company can order the required parts from the OEM and integrate them into its own products. For example, a company may have expertise in design, marketing, and assembling computer systems, but it may lack the capability to produce certain critical components, such as the motherboard. Therefore, a computer manufacturer may purchase a motherboard from an OEM and use it in their own product. The computer manufacturer can then sell the final product to the end customer. Instead of manufacturing products in-house, the company contracts them out to specialized partners and concentrates on product design, software development, and marketing.

Equipment Scheduling

Or, an OEM may sell customized fasteners with a branded monogram to a VAR—for example, the RL monograms for the clothing company Ralph Lauren. Chosen for production quality, process control, component sourcing flexibility, and adherence to custom specs. Zebra Workcloud, enterprise software solutions boost efficiency, cut costs, improve inventory management, simplify communication and optimize resources. In cases when businesses have the original version of a product and want to have an oversight of its making, they should consider subscribing to the OEM model. This applies particularly to those with strong brand identity and stringent quality specifications.

Advantages for the Client

Whether building PCs, powering data centers or embedding intelligence into everyday devices, OEMs will continue to be foundational to how technology is created, customized and delivered. OEMs are deeply involved in the design and customization of AI infrastructure, providing tailored platforms to vertical markets like healthcare, manufacturing and retail. In many cases, a company can function as both an OEM and a reseller, or even as a value-added service provider, depending on its role in the distribution chain.

” and marketing materials suggested that Intel and Dell were partners in the processor and computer design. Moreover, Zebra’s lifecycle management services ensure that customers get the most out of their investments by providing ongoing support and maintenance throughout the entire product lifecycle. Linkages among such factors as business requirements, product plans, and changes in the market environment usually influence this decision. A business utilizes a shift to acquire different technologies, manage costs better, or have more flexibility in the product development cycle. Based in Taiwan, Foxconn Technology Group is often considered the biggest electronics manufacturer in the world.

Real-World Examples of OEM and ODM

Additionally, OEMs offer excellent support and warranties as what does oem stand for in business they work directly with the VAR, which also positively affects the end user of the final product. OEMs are important for manufacturers, businesses, and end users alike as all of these profit from OEM technology. Companies that do not have the capacity to manufacture every single part of their end product can outsource the production to a factory OEM. That prevents them from having to establish their own factories and storage spaces – which would increase the production time and prices. Cosmo Sourcing is committed to facilitating this business journey, offering expert guidance and support in connecting with reliable Asian OEM partners.

OEM Manufacturer Role: Production Specialist and Execution Partner

• Overall, Zebra’s history of innovation, customer service and product excellence makes Zebra an exceptional OEM partner for businesses across various industries.
• For companies looking to leverage OEM for their production needs, the key to success lies in meticulous partner selection, robust quality control measures, and proactive engagement with technological and regulatory changes.
• That means that customers receive a high-quality product with usually the same type of support or warranty that the original part offers.
• Additionally, OEMs offer excellent support and warranties as they work directly with the VAR, which also positively affects the end user of the final product.

In the previous example, although the OEM manufactured the original parts used to assemble the car, additional companies sell equipment for the aftermarket. The consumer can buy replacement equipment for the original parts from these companies. OEMs usually make parts to sell to VARs as opposed to complete, finished products. An OEM may manufacture electronic components for a VAR that makes high-definition TVs, such as Samsung.

• Their capabilities span from intricate components for electronic devices to robust parts for industrial machinery.
• This means that OEMs act as suppliers to other manufacturers, providing the raw materials that are essential for the production of the end product.
• ” and marketing materials suggested that Intel and Dell were partners in the processor and computer design.
• Businesses that anticipate and adapt to these trends will not only survive but also thrive in the competitive global marketplace.
• In the IT and electronics industries, OEMs are foundational to global supply chains, serving as critical partners for component suppliers, software vendors, system integrators, resellers and end-device manufacturers.
• A good example of OEM hardware comes from the computer industry, and it applies to both business customers and consumers.

OEM is a company that manufactures products or components for other businesses according to their specifications. The businesses that purchase OEM parts are the Value-added resellers (VARs). The original equipment manufacturer generally concentrates on selling to other businesses, or B2B sales, while the VAR focuses on marketing to the general public. In the realm of manufacturing, an OEM partner plays a vital role as a company that produces goods for another business. This collaborative relationship stems from the concept of original equipment manufacturer. Here, the partner manufacturer creates products specifically for use by various brands.

With Zebra’s family of fixed industrial scanners and machine vision technologies, you can tailor your solutions to your environment and applications. They are not the same; however, they are both equally relevant in offering a business a range of disadvantages and advantages. With ToolSense, you get an integrated after-sales portal for your customers. Additionally, you can digitize your machines with state-of-the-art IoT hardware.

This team works closely with customers to understand their unique requirements and develop customized solutions that meet their needs. One of the key benefits of focusing on core competencies is the ability to allocate resources effectively. Designing and marketing a product requires specialized skills, knowledge and creativity. OEM plays a large role in manufacturing, such as in the automotive or IT sector. Many companies – referred to as the value-added reseller (VAR) – do not have the full capabilities to manufacture all the items that they need to finish their end product.