OEM companies (or “Original Equipment Manufacturers”) and ODM manufacturers (or “Original Design Manufacturers”) are very prominent in the IT industry. This is due to the effectiveness of the OEM & ODM business model, which emphasizes lower costs, faster turnaround, and higher quality.
These advantages stem directly from the nature of a typical business partnership between the OEM & ODM company and the Reseller.
First, let’s briefly cover what these business organizations are:
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An OEM company is the manufacturer that simply builds products — usually in large volumes — on behalf of another company, using the specifications provided by that company.
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An ODM company is a manufacturer that both manufactures and designs their own products according to their own specifications.
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Resellers and Value-Added Resellers (VARs) then work with the OEM or ODM Company to finalize a design, customize and rebrand the product with their own logo and marketing profile, package the product as a complete retail solution, and sell it directly to the customer as their own.
Ci Design is a combination of both OEM and ODM, designing a basic standard product line based on Ci Design’s own specifications, while offering rebranding options or complete design options from scratch to finish to Resellers, VARs, or other OEM & ODM companies.
Here’s an example of how this works:
Let’s assume a fictitious company called “Super Data Servers” sells server units to several high-end IT solutions to online web hosting companies, and wants to introduce a new storage-and-server combo unit to the market.
Rather than designing and manufacturing this new unit in-house, they call an OEM & ODM manufacturer like Ci Design to make the product:
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Super Data Servers meets with Ci Design and provides a basic idea of what product they want made
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Ci Design works with Super Data Servers to complete a custom design based on those specifications, offering advice and industry expertise from the manufacturing perspective
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The design undergoes development, fabrication, and production
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The product is delivered to Super Data Servers with their brand and logo on it
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Super Data Servers repackages the new product, complete with manuals and miscellaneous accessories, and releases it to the market as their newest storage-and-server combo solution
Click here to read more about the OEM & ODM Design Process.
