If you want to start your business off on the right foot by making your products, then China, the manufacturing hub, should be a no-brainer.
Hiring an OEM company in China can be the best option for many overseas businesses to save on costs, and time and gain higher quality products.
This article provides a comprehensive list of benefits of hiring an OEM manufacturing service provider in China. Read on to find out more you need to know.
What is an OEM
OEM is an abbreviation for Original Equipment Manufacturer. In China, OEM is also known as contract manufacturing or outsourced manufacturing.
Typically, an OEM makes products for another company, which then sells these products under their brand name to the end customers.
In this case, the company that buys OEM items is called a “value-added reseller”(VAR). The company provides the initial component, thereby adding value to products before selling.
Traditionally, an OEM works on a business-to-business (B2B) model, which is commonly used in electronics and beauty products.
1. Less Initial Investments
Manufacturing products requires the right expertise and effective infrastructure to ensure that it’s done at scale.
By working with an OEM in China, you can save a lot on initial costs to build a production plant, acquire some machinery equipment and organize a team of engineers and workers. You don’t have to purchase raw materials or pay for operational expenses either.
You are essentially outsourcing everything to an OEM company that already has the machinery, manpower, and systems in place so you can have a bigger budget for your product of higher quality.
2. Cost-Competitive
If you work with an OEM manufacturing company in China, you can enjoy manufacturing at an affordable price due to the economies of scale.
The truth is, large volumes, streamlined processes and efficient supply chains especially in low-cost regions like China make OEM parts cheaper than if they had been manufactured by yourself.
So when your products are made in high quality and tagged at reasonable prices, it leads to increased sales, revenue and profits.
3. Fast Production
When you hire a Chinese OEM company to make your products, you can save on time because they will handle all aspects of product development and product manufacturing.
Rather than having to bring it from scratch, working with an OEM supplier that has years of experience and expertise in the facility, your product gets built faster with precision.
The company will take care of everything needed to have your goods produced, and it will be done according to a schedule set by you.
4. Flexibility
Although having your factory is a good way to get exactly what you want, outsourcing to OEM manufacturing can be a smart try if you are new to this field.
Typically, many Chinese OEM suppliers will happily cater to lower volumes while still a customized production plan for your needs.
Meanwhile, when you don’t have to maintain your production plant, you can quickly adapt to ever-changing market demands. Scale up or down as needed, quickly and without much hassle. And you can prepare different manufacturing plans associated with different levels of uncertainty and variations.
5. Expertise
China has some of the most highly-developed manufacturing infrastructures in the world. It is home to millions of factories catering to the requirements of different industries. In the past decade, policymakers spared no efforts to build industrial clusters to boost industrialization.
Therefore, many OEM companies have been working in a certain field for years, knowing the whole manufacturing process and having vast experience to avoid making mistakes. This makes them experts in that process.
Even though you are not fresh in the OEM field, you still don’t know everything and there are things you can learn from someone who has been around for a while.
Take die casting for example, an experienced OEM manufacturer knows how to spot quality defects before they even happen. When it comes to manufacturing defects such as low wall thickness and high die surface porosity, they take steps to prevent these problems by utilizing certain techniques.
How Do I Choose An OEM Supplier That Is Right For Me?
As you do your research into potential manufacturers, keep in mind that not all of them are created equal. Different OEM suppliers have different resources at their disposal, so find one that’s well-equipped to handle your project.
If you are not based in China and don’t speak the local language, you may want to work with those who are of western ownership and management background.
China 2 West can be your best fit. C2W is a British owned and managed company based in China since 2005. We have a team of experts who are ready to help. Contact us for more information.
