The ODM business model is a pioneer in product development

Manufacturing companies have adopted a business model of self-design and production for a long time and have pursued both advanced technology and high quality as goals to achieve long-term development.However,the added value of many products has experienced an accelerated decline globally with the rapid changes in market demand trends in recent years.Thus,there is urgent demand to change the previously established business model.

Companies need to adapt to business models such as OEM,ODM,and EMS to thrive in an ever-changing market and focus on the development of the most recent high value-added products while outsourcing the development and production of low-value-added products.This is the only way companies can continue to keep their leading edge and succeed in market competition in the future.We have begun recommending customers adopt the ODM business model early to cope with this change in business models.

Advantages of the ODM business model

1.Maintain a lead in the industry.

Focus the company’s resources on developing the latest products with a high added value to keep the company at the forefront of the industry and thus generate brand benefits.

2.Increase company earnings.

The ODM business model can expand production capacity for products in the growth stage in the short term,quickly occupy and win the market,and increase profits.

3.Seize market opportunities.

Once new business opportunities are discovered,new products can be launched in a timely matter with the ODM business model to seize the market even if resources are limited.

4.Reduced development costs.

Development costs are generated in the for of NRE(Non-recurring engineering)in the ODM business model,which can mitigate increases in fixed costs.In addition,ODM purchases raw materials and parts centrally,which leads to preferential prices.