ODM (original design manufacturer) companies aren’t given much thought when we talk about technology brands, yet these are the ones which have the most power to decide what kind of devices the world uses. Very few of the laptop, smartphone, gadget and computer component brands in the world actually manufacture their own products today. As tech gets more and more sophisticated, companies need to keep spending money to upgrade their manufacturing facilities to stay on the leading edge. They also need to trim prices as much as possible to remain competitive in an open market where everyone uses the same basic components to build their devices. With such conflicting interests, the costs of maintaining a manufacturing facility begin to outweigh the benefits.
ODMs allow companies to outsource manufacturing. They leverage economies of scale by producing in enormous quantities. Nearly all of them are based in China, where employees are cheap and easily replaceable (and, some allege, easy to exploit without legal trouble). They build nearly anything, to any specification, and at any level of quality. They also offer anonymity—you’ll rarely find the names Compal, Quanta, Clevo, or Inventec on these devices, yet these companies build and often design the whole product.
YOU’LL RARELY FIND THE NAMES COMPAL, QUANTA, CLEVO, OR INVENTEC ON YOUR DEVICES.
We’re used to thinking of the word “Chinese” as derogatory for something of such poor build quality that it’s nearly disposable. Toys with sharp edges, flimsy appliances, and even imitation watches and clothes. But nearly everything with an American or European brand name on it, (including Apple’s gorgeous plastic and aluminium machines which set benchmarks for style and production quality), comes out of an ODM factory in China. Companies can spend a lot of money and have their own designs turned into real products; others pay for exclusivity (so no one ever needs to know where their products came from), while others just pick up readymade devices by the thousand and slap their own stickers on. Apple makes it a point to label all its products as “designed in California”, which shows how well its ODM partners follow designs so that Apple’s image stays unaffected. On the other hand, small-time companies sell identical-looking laptops and even retail chains stock self-branded devices which are clones of these, either hoping no one else has the same design, or accepting this as a part of doing business.
In fact very few companies which claim they have spent money on research and development to come up with special products for Indian conditions are telling the whole truth. They might only be picking from a limited number of customization options offered by the ODMs. Surprisingly, a small number of companies thrive by picking up ODM designs and boasting that they are sourced from exactly the same production lines as big-brand devices, and sell them at lower rates!
ODMs not only control production, but are getting ambitious themselves. Watch out for new, more powerful Asian brands emerging in the very near future
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