What is the full form of OEM?

The full form of OEM is Original Equipment Manufacturer. An OEM is historically a corporation whose goods are utilised as components in the products of another company and then sells the finished product to consumers. OEM is a company that resells items or portions of another company’s product to its own customers under its own brand. OEMs are largely present in the automotive and computing industries.

1. A company that manufactures vehicle tyres. Consider a person purchasing a Honda City automobile, the Apollo Tyres that come with the car, and the tyres Apollo labelled as an OEM here.
2. Foxconn (Taiwanese electronics contract manufacturing corporation) produces a wide range of equipment and parts for companies such as Dell, Apple Inc, Nintendo, Xiaomi, Google, Huawei, and others.

History

The term OEM derives from the Dutch language ‘onder eigen merk,’ which translates to ‘under own brand’ in English.

The relationship between the OEM and VAR

VAR (Value Added Resellers) sells goods from an OEM but adds additional functionality. The two have a mutually advantageous relationship in that VARs help OEMs advertise their products, while OEMs accept their product lines to VARs, allowing them to sell them with additional upgrades that improve product service.

Advantages of OEM parts

• Quality guaranteed
• Comes on warranties
• Simple to choose which part you required

Disadvantages of OEM parts

• High Costs
• Mostly sold at discounts
• Hardly any variety in parts.