Like many areas of technology, the contract manufacturing marketplace is undergoing a significant shift.
Original equipment manufacturers (OEMs) now have the potential to move more product design and development work to their EMS partners and thereby derive two key advantages: OEM can reduce their overall costs, and shift from fixed costs to variable costs.
Many electronic manufacturing services (EMS) companies are expanding into new services that offer high margin. They are providing new services along the spectrum. At one end, they’re offering more design services, for either sub-assemblies or finished products. At the other end, they’re offering more testing services. The more services EMS providers offer, the more they move into new models of joint design manufacturing (JDM) and outsourced design manufacturing (ODM).