OEM, or Original Equipment Manufacturing, is a type of outsourced manufacturing or contract manufacturing in which a factory is willing and capable of manufacturing products based on your unique design and specification. And you must conduct your research and design in order to create a product specification sheet that will show the factories what the product should be. Generally, OEM entails making a tool before beginning production.
China, as the world's factory, manufactures 29% of global merchandise, including many OEM products. Electronic items, hardware startups, and mechanical parts are exported as OEM items from China.
How to evaluate OEM Suppliers in China?
OEM services differ from merchandise purchases in that the suppliers in charge of your production must fully comprehend your design and specifications. They should also have a strong sense of service, professional business concepts, and ethics to deliver on time.
when selecting an OEM supplier, apart from evaluating the factory equipment, technical capability, service attitude, MOQ (Minimum Order Quantity), lead time, and factory environment, as well as the quality control system, You Should Also Keep in Mind the follows Points:
#1. The suppliers should be able to communicate with you efficiently and be flexible in handling your orders.
#2. To avoid IP infringement, you should sign a Non-Disclosure Agreement (NDA)with the suppliers.
#3. Request submission of Samples prior to Massive Production.
Next, I will elaborate on these three points.
Factory or Trading Company for Your OEM?
You may ask, “Since I am looking for an OEM supplier to do the production for me, I certainly hope to cooperate with factories directly. Why should I work with trading companies? Isn’t that going to crease my cost?”
Actually, it might be the opposite. You could learn more about how an export agent can offer lower prices than a factory by clicking the following link:
This is just one example. Imagine you are purchasing a simple plastic spoon in the quantity of 20,000 or more, the factory will be happy to run your order because it is simple, requiring only the creation of mold and the start of production right away, with no need for accessories or assembling.
However, if it is a set of products, such as spoons, glass bowls, bamboo cutting boards, and other items, with a quantity of fewer than 3,000 sets and packed in customized boxes, such as display boxes, then trading companies will be more appropriate for you, as they have more sources.
When your orders are small, the factories may lose patience, whereas trading companies combine small orders from different customers and work flexibly with the factories.
Now, I’d like to share an interesting story about molding with a factory. A western buyer placed an OEM order with a factory, and everything went well for six years until the mold wore out, causing the products to fa short of specification. The buyer then complained about having to pay for the defective products from the worn mold, while the factory was also irritated that the customer refused to pay to fix the mold or to make a new mold for quality control.
This demonstrates the importance of communication, and a trading expert will significantly reduce misunderstandings and improve efficiency.
Sign a Non-Disclosure Agreement (NDA) to avoid IP infringement
After choosing a supplier, DO remember to sign a confidentiality agreement with the other party. Because you did all the R&D yourself, it is critical that you have complete control over your Intellectual Property (IP). A comprehensive confidentiality agreement can ensure that other factories or competitors do not copy your IP.
The following information is typically included in an NDA:
a. Details of the buyer and seller (such as company name, contact information, address, telephone number, etc.);
b. Product information (material, size, appearance, function, design, etc.);
c. Packaging requirement (packaging, LOGO, etc.);
d. Mold: ownership, right to use, repair, lifespan, cost;
e. Rights and obligations of both parties;
f. Compensation for breaches of contract;
g. Language version: the same as contracts or orders.
Submission of Samples prior to Massive Production
It has long been customary that the buyers obtain samples from the new mold and inspect them to ensure that the samples are in conformity with the specification before giving their green light to mass production. Still, there are some pieces of advice worth considering, particularly when developing a new product.
To begin, we recommend that you request your supplier start with a prototype with a 3D printer when a mold is required in production, regardless of the mold material, plastic, metal, glass, or silica gel. It will save you money and time to have the 3D prototype made before creating the final mold.
Second, once the mold has been approved, ask the factory to make as many samples as possible for your tests as it takes time and cost to make samples, and the factory may have to stop the production line while doing so. Otherwise, your repeated sample request may irritate the factory and land you in hot water.
Finally, whenever you discover a sample problem, notify your suppliers. Do not begin mass production until all issues are solved. Don't believe any promise that "the sample is just a reference, we will solve this problem in mass production." Be aware that small issues can quickly escalate into major issues.
Plus, in terms of requesting samples, this is a big topic. If you are interested, you can read the article I wrote about it by clicking the following link:
I hope this article has assisted you in finding a reliable OEM supplier in China. If you are still confused, or you want to learn more about promotional items from China, please feel free to contact me at sales@plentmax.com.
