What exactly is Original Equipment Manufacturer and how can people benefit from it?
There are products that are composed of several components and not all parts are made solely by the company and this is where original equipment manufacturer comes into the picture because they are the ones that produce the other components of the final product. In the corporate world, there is such a thing as value-added reseller wherein any company that makes use of an original equipment manufacturer can increase the selling price of their final product because of the fact that they are not the sole producer of all its parts and they would still have to order some of it from other companies. The reason why an increase in selling price is necessary is because these components that original equipment manufacturer create are often times customized.
A good example would be car companies since cars have various parts in them and these parts are not all made by one company. If you would take your car and break it down into pieces, you would most likely see parts that are stamped with a different company name. All the OEM would have to do is create the custom made parts and send them to the automobile company where these parts are then assembled into a car. If the final product did not have parts made by other companies then you would expect it to be cheaper.
As the world rapidly advances, OEM also advances with it and now these companies have a new term used specifically by companies under the computer industry. Rebranding is the most important terminology here because this is exactly what companies do tot he products or components that they buy off other companies. There are some computer companies that have created a certain software that people would want to get a hold of and to make money out of this, other companies would buy this software and add it to their own product to attract buyers. The OEM in this case would be the company tat does the incorporation and rebranding of the computer component they bought from another company.
Now let us dig deeper on how the OEM really works.
As you might have already realized, VAR and OEM companies are those companies that cannot stand alone on their own but rather, they work together to make a profit. The production of certain parts is an important aspect in the finish product and in making a sale, which makes EOMs very valuable to VARs. The EOMs has specific responsibilities on create parts but they have no say on how the final product will be made.