What's the difference between OEM and ODM?

ODM and OEM are acronyms that are the buzzwords in the manufacturing sector. ODM stands for Original Design Manufacturer and OEM stands for Original Equipment Manufacturer. While many people confuse between the two terms and use them interchangeably, they are not quite the same. OEMs manufacture product based on design specification provided to them, while ODMs also design the product themselves before manufacturing them. Let’s understand the difference between the two in more detail by understanding them one by one.

Both OEMs and ODMs aren’t limited to technology, consumer electronics or engineering sector, though they are more common in these sectors because products in these sectors are more design intensive. They are also present in other industries like fashion, footwear, personal grooming, etc

One should always exercise caution when dealing with both OEMs and ODMs. In the case of OEM, providing them with secret product design and specs over which a company has invested huge amount of time and money can result in breach of intellectual property rights and the product design being stolen by copycats. So you need to work with an OEM that is trustworthy.

In the case of an ODM, you may have little to no control over product specifications and so you need to set adequate parameters and frameworks within which the ODM needs to work.