What Is the difference Between ODM and OEM and Why Should You Know About It?

There is often a discrepancy in the use of labels such as ODM and OEM when it comes to considering the types of products that one might buy. ODM stands for Original Design Manufacturer while OEM is an abbreviation for Original Equipment Manufacturer. The two terms refer to two completely different approaches to product manufacturing and should not be used interchangeably.

OEM cable

Loosely put, the definition of OEM has to do with a product that features a customized design, as well as custom dimensions, functions and materials, all discussed with the buyer prior to the design actually being put together. The OEM cable manufacturing process involves the buyer to a heavy extent before a design is even produced, and in some cases, the product is even created entirely based on the specifications of the buyer. Most of the time, however, at least some of the tools and aiding materials used in the manufacturing of OEM products have to be developed in advance.

For ODM manufacturing, the design that is used is based on a design that already exists. This design is produced by the manufacturer in advance, even though it can also be based, either legally (or illegally) on a design provided by another manufacturer or company. ODM products are also commonly referred to as “private label products.”

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