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What is OEM (Original Equipment Manufacturer)?
OEM refers to a business model where products are manufactured under another company's brand name.
Recently, the importance of the OEM business model has grown, driven by the rise of fabless manufacturing and an increase in venture companies.
OEM is primarily classified into two types, and both parties involved— the commissioning party and the contracting party—benefit from each type.
Understanding the characteristics of each form is essential to selecting the best OEM partner for your business.
The commissioning party is responsible for the development and specification of its own brand products, while the manufacturing is outsourced to the contracting party.
The contracting party designs and manufactures the product and offers it to other companies for sale under their brand.
Sell Your Own Branded Products with Minimal Capital
Reduce Inventory Risk
Focus on Product Development and Marketing
Enter New Markets Even Without Expertise or Technology
Significant Cost Savings Compared to In-house Manufacturing
Leverage the Sales Power of Well-Known Brands
Increase Profitability Through Higher Production Volumes
Reduce Costs for Expanding Distribution Channels
Enhance Technological Expertise
Mitigate Market Volatility Risks
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