OEM and ODM are two abbreviations you have heard if you are an importer. When you decide to outsource your skincare OEM manufacturer, you first have to find a local manufacturer that can make the skincare product for you. You must decide either whether to choose Original Equipment Manufacturer (OEM) or Original Design Manufacturer (ODM).
To know what these two acronyms are and what their advantages are; keep reading:
OEM has simply outsourced manufacturing or contract production. OEM is like a factory that is capable and willing to manufacture products as per your product design and specs.
You might think that you need an OEM manufacturer for even minutest customization. However, this is not the case. You can assume that you are dealing with an OEM skincare product if you require to make new tooling before you can commence production.
Usually, before you give go-ahead your OEM manufacture your product, you first need to surf the internet and comprehensively do your own research and development (R&D). The research includes design and engineering.
So, now you only need somebody who can look after the production. As you have designs prepared and have a clearly defined product specification sheet, you are ready to go to the OEM manufacturer.
1 – The biggest benefit of OEM is that it gives you control over your Intellectual Property (IP). Since you have done the whole R&D yourself, all IP rights are your belonging. IP provides you a better position to bargain while you can switch to other anti-aging skincare lines manufacturer.
2 – Because you have the detailed designs and packaging specifications, it is straightforward to receive quote from the buyers.
For small scale businesses, the main disadvantage of dealing with OEM is to give them precise and complete specs and designs.
Not every company has in-house facilities to produce their healthcare item. They may not be in true position to hire 3rd party manufacturer. For them, the option of ODM would be a great alternative.
Original Design Manufacturer is another type of contract production. However, the service of ODM is somewhat wider. ODM provides product development services and even whole product lifecycles in certain cases. The actual scope of service varies per ODM and is dependent upon ODM’s abilities.
1 – You never need to make big or upfront investment as the skincare product development is looked after by ODM.
2 – You do not require to have technical facilities that can provide detailed specs and designs. The ODM will look after this.
The most crucial factor is Intellectual Property rights. You do not have the IP right while working with ODM.
Therefore, thorough and careful due diligence is critical while working with an ODM.