OEM - OEM

An industrial term referring to contract manufacturing of products or parts under the condition that a company sells under the client's brand (trademark), or to contract manufacturers. It is an abbreviation of the English terms original equipment manufacturing or original equipment manufacturer. In Japan, it is translated as "production under the client's trademark" or "contract manufacturing under the client's brand." It is said to have started in the American electronics industry in the 1950s, and has spread to a wide range of industrial fields such as home appliances, automobiles, information devices, food, clothing and miscellaneous goods. The client may provide the client with the design of the product or parts, assembly drawings, production methods, etc., and may also provide technical guidance. OEM can be seen as a type of subcontracting or a form of division of labor. In the distribution industry, products made under a company's own brand, especially those made by OEM, are called private brands (PB).

For the outsourcing company, outsourcing production to other companies has the advantage of being able to secure the minimum number of products necessary for sales, and thus reducing capital investment and production costs. In addition, during the product launch and introduction phase, it is useful for improving brand power and disseminating and standardizing the company's own technology, during the growth phase, it makes up for a lack of production capacity, and during the maturity and decline phase, it has the advantage of being able to focus on new product development while maintaining product sales. However, since production is dependent on an outside party, the profit margin is low, and there is also a risk of production technology and quality control know-how being leaked. For the outsourcing company, in addition to utilizing production capacity and improving its own technology, it is expected to increase sales by using the brand power of leading companies without incurring promotional expenses. Another advantage is that distribution-related companies such as trading companies and department stores that do not have manufacturing departments can sell their own brand products. There are two types of OEM: vertical division of labor, in which a company with a high level of technology instructs a company with a low level of technology, and horizontal division of labor, in which companies with the same level of technology work together. There is also a mutual type of OEM, in which different products and parts are mutually outsourced. Furthermore, ODM is an evolutionary and more developed form of partnership than OEM.

[Takeshi Yano March 18, 2016]

Source: Shogakukan Encyclopedia Nipponica About Encyclopedia Nipponica Information | Legend

企業が委託者のブランド（商標）で販売するという条件で、製品・部品を受託生産すること、または受託生産メーカーをさす産業用語。英語のoriginal equipment manufacturingまたはoriginal equipment manufacturerの略語である。日本では「相手先商標による生産」「納入先ブランドによる受託製造」などと訳されている。1950年代にアメリカの電機業界で始まったとされ、家電、自動車、情報機器、食品、衣料・雑貨など広範囲の産業分野で普及している。委託者が製品や部品の設計から組立て図面、製作手法などを受託者へ供与し、技術指導を行うこともある。OEMは一種の下請け、あるいは分業の一形態とみることもできる。流通業界では、とくにOEMでつくった自社ブランド品をプライベート・ブランド（PB）とよぶ。

　委託企業にとっては、他企業へ生産委託することで、販売に必要な最小限の数量の製品を確保でき、設備投資や生産コストを節減できる利点がある。また製品の発売・導入期においてはブランド力の向上や自社技術の普及・標準化に役だち、成長期には生産能力不足を補い、成熟・衰退期には製品販売を維持しながら新たな商品開発に集中できる利点がある。しかし生産を外部に依存するため収益率が低いほか、生産技術や品質管理ノウハウなどが流出するおそれもある。受託企業にとっては、生産余力の活用や自社技術の向上のほか、販促費をかけずに有力企業のブランド力を使って売上高を伸ばす効果が期待できる。また製造部門をもたない商社や百貨店などの流通関連企業が自社ブランド品を販売できる利点もある。OEMには技術レベルの高い企業が低い企業を指導して実施する垂直的分業といえるOEMと、技術が同水準の企業どうしで実施する水平的分業といえるOEMがある。また異なる製品や部品を相互に委託しあう相互乗入れ型のOEMもある。さらに、OEMが進化・発展した提携形態にODMがある。

［矢野　武　2016年3月18日］

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