If you’re new to the manufacturing industry, you’ve probably already come across plenty of abbreviated terms—some are acronyms (ex: NASA) and some are initialisms (ex: FBI). In manufacturing, these abbreviations can refer to government agencies, certifications, regulations, and more. Today we’re discussing the symbiotic relationship between OEMs (Original Equipment Manufacturers) and EMS (Electronics Manufacturing Services). While their core focus is very different, they often complement each other and may even help grow one another’s business.

Simply put, an OEM dreams up the product and the EMS builds it. OEMs own the product’s intellectual property and focus on its Research and Development and product scalability and expansion. An EMS helps the OEM with the design, manufacturing, supply chain, and logistics. In addition, an EMS may aid the OEM with fast-tracking their design process and scaling production to expand into additional sectors and markets.

More often than not, OEMs are choosing to outsource manufacturing so they can focus more on product innovation and development along with marketing strategies. So what about the “M” in “OEM?” Well, more and more OEMs are getting out of the manufacturing business. The OEM designs the product and owns the rights to sell it under its own brand. While some use equipment designed for mass production of their specific products, partnering with Printed Circuit Board Assembly (PCBA) companies eliminates the need for costly in-house production units. Leveraging the expertise of an EMS provider allows the OEM to focus on their core competencies like product development and marketing.

An EMS provider is much more than just a manufacturing partner. Yes, an EMS provider handles the manufacturing of a product, but they offer so much more to their customers. An EMS will not only support the OEM with their initial design, but they also provide procurement assistance, shipping management, electronics testing, repair, and rework. Their services encompass the entire product lifecycle. An EMS is focused primarily on manufacturing various parts, so they are fully equipped and typically opt for machines that allow for quick changes between products. They serve a large customer base and can operate on a larger scale, making their product more economical.

The relationship between an OEM and EMS is a perfect example of how two companies can coexist and leverage the other’s expertise to enhance overall manufacturing efficiency and product success. The OEM can focus on innovation and product development while avoiding huge investments in equipment. The EMS, on the other hand, can benefit from partnerships with multiple OEMs by remaining on the front lines of technological advancements, thus enhancing their capabilities and market reputation. It’s a win-win situation!