Updated: Feb 15
As the Internet seeps into the mundane we don’t just find our thermostats becoming smarter. We find our way of living more to our liking. That’s because the Internet can make life customizable. Nowhere is this more apparent than in the realm of shopping. So, how we can customize a product? Who cares? To answer these questions we may get familiar with ODM and OEM.
ODM Manufacturing is commonly categorized into white label and private label. For suppliers offering white label services, they distribute their generic finished products to different retailers, who thereafter sell them under their own brand name.
In contrast, private labeling services providers sell finished products that are produced and sold exclusively to a particular retailer. The difference between white label and private label is usually product specific and manufacturers offer both. Despite this difference, the two terms are often and wrongly used as synonyms.
Both white label and private label allow you to benefit from much lower costs in bringing a product to market, letting you focus on other core parts of your business. ODM is similar to the term “OEM” or original equipment manufacturer but it is not to be confused.
With relying on an OEM, the manufacturer is often producing just a component based on your own company’s design and specification. Whereas with ODM manufacturing, you are usually buying a pre-designed and pre-produced product that you will go on to brand and sell as your own. OEM products are therefore typically more time-consuming than ODM products but as the buyer, you own the intellectual property of the product. You can customize the product. It may be more difficult to copy your product. And there is also, less risk in manufacturing because a working prototype is available.