When you purchase products, you will probably find the terms OEM and ODM. The terms we see here are OEM and ODM related to different production approaches. You’re probably wondering what those terms mean and which is your best option for you. See the difference between OEM and ODM.
OEM means the original equipment manufacturer.
OEM production can be the best option for people and companies with new and innovative products. Basically OEM is when the company designs a product from the ground, then contracts another company to make for them. For example many companies uses OEM to manufacture their devices. They came to design, and then contracted the number of third-party manufacturers to deal with mass production. The minimum order quantity will be higher than with the ODM due to a higher level of capital expenditure and technical understanding of the product needed.
ODM is also called the original design manufacturer.
When you meet ODM, it refers to the company that is the original manufacturer of the design. These companies design and manufacture a product that is eventually sold by another company with the company brand. In this case, ODM does everything from product design to manufacturing. This type of company is often used in international trade. Local ODMs provide benefits to foreign companies by offering lower costs for local products.
The ODMs are important in international trade, since a local ODM can greatly benefit foreign companies by reducing costs, while the OEM simply adapts them to the specifications, design and requirements of the purchasing company.