Benefits of OEMs

- Jan 20, 2019-

1. For well-known brands of enterprises. This approach is the pursuit of profit maximization strategy. The world's first OEM came from the garment industry.   Many famous garment enterprises in developed countries in order to reduce costs and improve the competitiveness of their products, the production base of their products gradually expanded overseas, commissioned local production and manufacturing, and then dubbed their own name in the market sales. The risk of expanding the market is reduced by reducing the occupation of production funds entrusted to enterprises. Compared with their own Shing, mergers, joint ventures, mergers, OEM commissioned processing for brand enterprises, accounting for the least amount of funds. Improve the speed of new products of brand enterprises to intervene in the market. "OEM" is a good choice for quickly capturing the market in the short term.   It is a good choice to effectively reduce the risk and lose the market. Many world-class home appliance manufacturers have shifted their business models from mass production to mass customization. Through OEMs, we can quickly complete the global coverage of the Enterprise brand, but also reduce investment costs and investment risk.

OEM is also an important means for foreign brands to open up the Chinese market. The specific approach is what we usually call "one supplement": Incoming materials, samples, equipment, do compensation trade. As the trend of global economic integration continues to strengthen, foreign brands will also be heavily stationed in the Chinese market. These brands in the Chinese market visibility, recognition is not very high, the construction of their own factories and face a long cycle, high cost problems. Therefore, the use of China's existing production lines of relatively surplus production capacity for licensing, is to cut into the Chinese market a shortcut.


2. For the entrusted enterprises. "OEM" so that idle production capacity has been fully utilized, equipment depreciation can be achieved, unit product production costs decline (including the enterprise's products), the income of workers have been guaranteed. "OEM" has promoted the technological progress of the enterprise, accelerated the speed of equipment upgrading, and trained a group of technical experts and technical workforce. "OEM" helps to improve the management level of enterprises and the management ability of entrepreneurs.   Help to play their own expertise in specialized production, improve their competitiveness in the industry's professional production. To do OEM can not only earn their original money, but also learn the business methods and experience of many well-known enterprises