World Class Original Equipment Manufacturer Service( OEM service )
An Original Equipment Manufacturer (OEM) is a company that produces parts and equipment that may be marketed by another manufacturer. Original equipment manufacturer (OEM) service involve customized designs of products that are marketed by another companies. The term OEM service is a misleading term. Generally, this term is used for a company that are computer and IT producers. Therefore, it is also called electronic manufacturing services for consumer electronic product.
OEMs are not original manufacturers. They are a company that manufacturer and design products as per the demand and requirements of other companies or manufacturers who will trade them under their own branding. Therefore the process of printing your own brand and logo is also referred to as private label. OEM service are not only limited to software industries, but it also includes companies like automotive, electronics etc.
Most time OEM is pertained to hardware products. However, this is a misconception that it is related only to hardware industries. Automotive industry is a great example of using OEM service. A car that you buy is not manufactured entirely by a car company. Some parts of a car are manufactured by other companies. Most of outsourced units of cars are airbags, navigation units, spark plugs, air conditioners, dashboards, sensors etc. Sometimes engines are outsourced also. You will be dazzled to know how little efforts are put by a car company if they are compared with branding and goodwill status.
Like automotive industry, manufacturing of hardware products are also outsourced. This helps to whittle down labor costs, improves worker productivity, and focuses on core business. Electronic manufacturing services are offered by those companies that design, test, distribute, and repair services for electronic components for original equipment manufacturers.
Here are the Benefits of OEM Service
Original manufacturer’s parts render a better design and quality
Companies can focus on their core activities by outsourcing manufacturing of some products or units to other companies. Original equipment manufacturers use cutting-edge technology to produce a high-end product. Every time companies have to bring in nonpareil products to engage their customers, and since an innovative approach is effectively used by original equipment manufacturers, it’s better to tie up with them.
Consulting original equipment manufacturer services saves your money
Another benefit of consulting original equipment manufacturer services is it saves a lot of costs. Business operation cost is important to analyze at every stage. Outsourcing cuts down on operation costs. A company can save up to almost 60% operational costs by using OEM service. If you opt for manufacturing all units in-house, your cost will hike up as you will hire more manpower. Recruitment can cause you a small fortune, and it will be a lengthy and a cumbersome process. Further, there’s no surety that you’ll find versed people. Outsourcing allows you to be free from the hassle of in-house production and impediment on production and other core activities due to it.
Hiring original equipment manufacturing services enable you to focus
You can focus on your activities by outsourcing the manufacturing of a unit or a product. Outsourcing can help you to focus on back-office activities and other cardinal activities that need your utmost attention. You can invest your energy and time on these activities well if you have outsourced a unit to other companies to manufacture. The ultimate goal of your business is to keep growing, and outsourcing prevents you from repetitive and redundant works giving you more time to grab other opportunities. Outsourcing improves efficiency. The more you focus on core activities, the more chances you grow. It helps to open the door of success.
By outsourcing, you can give away the liabilities and risks associated with a task too. If you hire OEM service instead of opting for in-house production, your time and money will save, and also the opportunity cost will go down.
OEMs improve customer satisfaction
OEMs can recognize customer satisfaction. Companies always aim to get the highest level of satisfaction by reaping reap the rewards of an OEM service. Outsourcing for the manufacturing of a unit or a product can really help to improve business operations and make you stand out in the market.
You can measure customer satisfaction at several points. For instance, if you have an automobile company, you can measure customer satisfaction from the first visit to your showroom to bringing your car for a service. You can ask your customers about your product – their likes and dislikes. Carefully monitoring of their responses will give you an idea about OEM services. If your customers find difficult to manage with parts that you outsource to OEMs, you will not clinch a contract with that OEM Company.
However, you should bear in mind that surveys should be short. Don’t expect your customers that they will embroil themselves in responding too much queries. Keep it short as much as you can. A few simple questions on a questionnaire is a great idea when they’re waiting to collect their vehicle. This approach will appeal to those customers who don’t have time and patience to answer long surveys.
How does OEMs to Distributors Process Work?
Original equipment manufacturers make customized products for companies that are sold by other companies under their brand name. However, this term refers to an ambiguous meaning. It sometimes means adding features in an existing product – this service is known as value-added reseller, and manufacturing the products that are marketed by distributors and sold to customers. Over time, the term has become a label to describe a variety of companies and relationships among companies. Here is the way how an OEM-to-distributor process works.
Make a strategy
A strategy will enable you to market your products effectively in selected territories. You have to make effectual strategies to decide which territories have the highest demand of your products. Different territories are covered under different distributors. So you have to find out a distributor who will cover up your territories. Apart from this, you have to analyze the products that a distributor deal in, and their business and legal relationship with your company.
Choose a territory
Expansion of a business is important for a long-time success. The faster buildup of your brand image, the better sales you will have. Your work is not finished with coming up with a distributor who covers your desired territories where you want to sell your products, rather you should establish a network of distributors. A network of distributors will enable your company to manage marketing and sales of your products even in those territories that are not covered under your distributor. This will also help you to identify potential distributors not only in domestic market but in international market too.
Territorial coverage is just one of the factors in selecting a distributor. The next step is to analyze the range of products that could compete your product line. You will have to study the market how your product line is prospering. Not only this, you will also be able to tap into other products range. Therefore, if distributors are currently marketing products that compete with your range, you must reach an agreement with your distributor.
An OEM and distributor ties up with an agreement. The agreement covers the level of stock that a distributor carries, discount levels, sales targets, logistics arrangements, customer support and marketing activities. The agreement also covers the amount of financial support, training level, and branding and marketing support that you will grant to a distributor. However, the terms of an agreement depends on the type of a distributor you’re dealing with. Whether it’s an independent distributor or a franchised distributor.
This process requires you a top-level of collaboration to keep your business growing. This also requires you to synchronize production with demand. You need accurate and timely information on sales and market demand from your distributors so that you can produce sufficient units to meet your customer’s demand. You can also ask your distributors to increase sales of your products by providing marketing support including campaign funds, marketing through brochures and advertisements, and co-marketing programs.
Customer relationships play an important part in the development of an OEM-to-distributor process. You have to provide technical support and other services from your own resources to your customers; however, a distributor will provide sales and logistics services. This gives you a greater control over the customer relationship and ensures that customers are receiving support to your quality standards.
When it comes to hire OEM service in China, you can choose to work with a China sourcing agent. Our company China SourceLink is such a leading sourcing company that provides OEM service for our customers. Here are certain reasons that explain how we transcend other companies.
China SourceLink as your first-choice China sourcing agent have incredibly industry specific know-how to face challenges and they assure their clients that entire work will be perfectly done. We are based in the city of Shenzhen, which is known as the electronic hub of the whole world when it comes to sourcing electronics. Also there locates the Huaqiangbei electronic market, where you can almost find any electronic products or electronic component. As compared to other companies, China SourceLink offer incredible services at low prices.
Not only this, another reason to choose Shenzhen agents is they follow a flexible approach. They are always set to complete all projects whether your project is customized or not. Shenzhen agents provide exceptional services with top-notch technology.