The difference between ODM, OEM, JDM in the PCB industry

The difference between ODM, OEM, JDM in the PCB industryThe PCB industry is a comprehensive industry involving multiple areas and industries, including design, manufacturing, testing, sales and other links. We often hear the words ODM \ OEM \ JDM. Some PCB factory will say that we only do OEM, and some say that we can do ODM. So what is OEM and ODM, and what are the differences between these?
Let's understand from the concept:
1> Original-Primitive
2> Equipment-Equipment
3> Design-Design
4> Manufacturr-Manufacturer
5> Brand-Brand
6> Joint-participation, union
The words are understood, and it will be easy to distinguish

OEM (ORIGINAL EQUIPMENT Manufactuer) is the abbreviation of primitive equipment manufacturers, refers to the manufacture of products by one company and selling it with the brand of another company.

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The advantage of the OEM model is that the existing production capacity and equipment can be used to reduce production costs and risks, and improve production efficiency and profit margins.
The disadvantage of the OEM model is that it may lose its ability to design and innovate product design and innovation, rely on customers' needs and orders, and facing challenges in price warfare and quality issues.

In the PCB industry, the OEM model is usually suitable for some high -customized, high -tech content, high value -added products, such as mobile motherboards, automotive electronics, etc.

OEM is also known as foundry manufacturers, authorized OEM production, and fixed -name production.

Simply put: B has a factory building and equipment with large -scale production capacity; A sees B's production capacity, so A first design the product, then send the drawing directly to B, and entrust B to process it according to the drawings, and apply A to A A. The brand, delivered to A.

A possession: equipment

B with: brand, design
B undertaking: brand+product design

A undertaking: manufacturing

ODM (Original Design Manufactuer) is the abbreviation of the original design manufacturer, which refers to the design and manufacturing of one company, and sells it with the brand of another company.

The advantage of the ODM model is that it can reduce R & D costs and risks, shorten product listing time, and improve market competitiveness.
The disadvantage of the ODM model is that it may lose independent intellectual property rights, reduce brand value, and face the pressure of homogeneous competition.

In the PCB industry, the ODM model is usually suitable for some standardized, generalized, low -tech products, such as power control pcb boards, chargers, etc.

simply put:

A not only has the factory in the factory, but also the development team; the development and design capabilities of A are viewed, so they entrust all the products to the development and production to A; B saves the time of design and research and development.

A with: design development, equipment
B with: brand, design

B undertaking: brand; A undertaking: design+manufacturing

JDM (JOINT Design Manufactuer) is a combined design manufacturer's abbreviation, which refers to the design and manufacturing of the product by two or more companies, and sells for the brands of one or more companies.

The advantage of the JDM model is that it can make full use of the resources and advantages of all parties, realize technical exchanges and innovation, improve product quality and performance, and expand market share and influence.

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The disadvantage of the JDM model is that it may increase communication and coordination and management costs, conflict with conflicts and trust, and affect the effects and continuity of cooperation.

In the PCB industry, the JDM model is usually suitable for some emerging areas, high -end markets, and high difficulty projects, such as smart wearables and medical PCB equipment.

The JDM PCB model is recently proposed by the wave of server manufacturers. It is a new business model that is different from OEM and ODM, that is, for application, integrate the industrial chain, and cooperate with the customer established. The research and development of products has been promoted to more industry customers, from scene satisfaction to trend leadership, and achieves successful business models from short -term products to long -term business models.

for example:

Bank (B) requires a batch of self -service tellers. The teller machine contains the contents of the hardware and software. At this time, they will find a manufacturer with hardware design and manufacturing capabilities (A) to jointly develop this product. In the process, A is biased towards the design and manufacturing of hardware, and B is biased towards the development of software systems.

A with: brand, software development
B with: hardware development, hardware production manufacturing

B undertook the brand, software; A undertakes hardware design+manufacturing, and finally assembles the finished product in the A factory, copys into the software system, pastes A brand, and ships to A.

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Electronics contract manufacturing allows small and mid-sized OEMs to make technologically advanced products and build a competitive edge. Contract manufacturing is often compared to in-house manufacturing. This post focuses on differences between these two types of PCB manufacturing.

Pros and Cons of In-House Manufacturing

The biggest benefit of in-house manufacturing is there is almost no possibility of any discrepancy in the design, manufacturing, or any stage of the entire process. While in-house manufacturing has some advantages, it has a flip side too. Here are some points to consider:

• As mentioned, the biggest drawback of in-house manufacturing for electronics manufacturing and PCBs is that it requires a huge investment to set up a fabrication unit, testing devices, CNC machines, and other advanced machinery.
• It also requires expertise for which you may need to hire experts in the related segments.
• The amount of resources, network, and capital is immense; you need to build a vendor network for part procurement to get the best or required parts on time. For this, you need to have your own logistics and supply chain unit.
• Storage of parts, in-process products, inspected products, and the ones to be shipped is an important aspect. For this, a big enough warehouse with a proper pallet racking system, material handling equipment, and inventory tracking software are essential.
• You need to comply to certain industry standards and policies and may require certifications too. If not done properly, legal implications may apply.

All in all, you need to invest in equipment, technology, human resources, and more. So, while in-house manufacturing seems an attractive idea, it is easier said than done.

Benefits of Contract Manufacturing

Contract manufacturing offers many benefits aside from just cost. Once you have the final product design ready, all you must do is to search and finalize a reliable and experienced PCB contract manufacturing services provider, which solves 50% of the problems associated with in-house manufacturing. Here are some benefits.

• The contract manufacturer has it all – fabrication unit, assembling unit, warehouse, supply chain, separate units for repairs, and all the other required infrastructure, human resources, and service structure. They will require only your specific, detailed designs to assemble your product. They take care of part procurement, components, materials, actual manufacturing design, inspection, and the entire process as such.
• Here, you may ask them for a prototype, get a design inspected multiple times, make changes if required, and so on. Contract manufacturers assist you at every stage as most of them have skilled and experienced engineers and designers working with them.
• You do not have to pay all at once and can divide it in parts as per the payment structure.
• You get a lot of flexibility, customization options, reduced time to market, and many other additional benefits.
• You get time to focus on your core area of expertise, related research, documentation, and more.

If you are an OEM manufacturing electromechanical or electrical products and do not have an in-house PCB manufacturing and assembling unit or the required expertise, you may need to partner with a reliable and expert contract manufacturing services provider. Aside from PCBA, you may require other services such as box build assemblies, supply chain, repairs and refurbishments, and more. Contract manufacturing services encompass all these services other than PCBA. Suntronic Inc. is an experienced EMS, which offers end-to-end services for PCBA, cable and wire harness assembly, box build assembly, supply chain, repairs, BGA rework, failure analysis, and more.

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