An original equipment manufacturer (OEM) refers to companies that make products for others to repackage and sell. Distributors buy products from these companies in bulk, without the expensive retail packaging and customer service that come with units sold individually. The product itself is essentially the same as the more expensive retail packaged versions. OEM products are used in many industries, but are perhaps most prevalent in electronics.
OEM mouse.
How these products are used
OEM resellers typically add some value before reselling the merchandise. A provider that does this is known as a value-added reseller (VAR). A VAR may build components, subsystems, or systems from parts made by other manufacturers. These products provide VARs with a wide range of creative marketing options, helping smaller resellers remain competitive in the marketplace.
OEM LCD monitor.
Multiple VARs working together
OEM products can be used at many different levels of an industry. For example, suppose a fictitious company, “Head Music,” makes popular sound cards, but wants to introduce digital versatile disc (DVD) drives to the market. Not manufacturing the DVD drives themselves, they contract with another company to supply them with the drives. “Head Music” takes mass-produced DVD drives, puts its own logo on the players, then repackages them with their sound cards and repackages them as “Head Music DVD Drive and Sound Card.”
Going one step further, another company can act as a secondary VAR and use the Head Music DVD and sound card package to build personal computer (PC) systems for sale. They contacted Head Music and signed a deal to buy the DVD and sound card combos wholesale. Head Music is now acting as the OEM for this new company.
They ship packages to the PC company, which acts as a VAR, without expensive retail packaging and at substantial savings. The PC company installs the packages on their PCs, along with other products like motherboards and hard drives. Even the operating system (OS) often comes from a different manufacturer, for example a version of a Microsoft® operating system. When the VAR is complete, they offer a PC with brand name components and software at a competitive price.
Product labeling and tracking
OEM hardware and software often have different product numbers than the retail packages, although manufacturers and resellers still control these products internally. The retail and retail versions of the software work essentially the same way. However, there may be some differences, such as a software program tied to a specific component on a computer, allowing it to be used only with that pre-built system and not other computers.
Guarantees and customer service
The public can often purchase OEM hardware and software at substantial savings. Hard drives are typical examples of these products, purchased in an anti-static package without a box, cables or manual. The warranty is generally the same, with software drivers, digital manuals, and additional support available online when not provided with the product itself.
Some products, however, do not have shorter warranties. This is true for some computer processors, for example, where the retail version has a three-year warranty, but the OEM version only comes with a one-year or 90-day warranty. Manufacturers provide support and warranty details with products, which should be read by anyone considering using them. A VAR using these products typically offers its own warranty on the items it sells, rather than the manufacturer’s coverage.
original ethernet cable
