An Original Design Manufacturer (ODM) is a company which manufactures a product which ultimately will be branded by another firm for sale. Such companies allow the brand firm to produce (either as a supplement or solely) without having to engage in the organization or running of a factory. ODMs have grown in size in recent years and many are now sufficient in size to handle production for multiple clients, often providing a large portion of overall production. A primary attribute of this business model is that the ODM owns and/or designs in-house the products that are branded by the buying firm. This is in contrast to a Contract manufacturer or CM. Wikibooks has more about this subject: Marketing A brand is a collection of images and ideas representing an economic producer; more specifically, it refers to the concrete symbols such as a name, logo, slogan, and design scheme. ... A contract manufacterer (CM) is a firm that manufactures components or products for another, hiring firm. ...

This model is especially used in international trade, where a local ODM is used to produce goods for a foreign company which sees some advantage in the transaction (such as low labor inputs, transport links, proximity to markets, etc.). This is also used where local ownership laws possibly prohibit direct ownership of assets by foreigners, allowing a local firm to produce for a brand company for either the domestic market or export.

This type of business is part of 'Outsourcing'. An example is Compal Electronics, which makes notebook computers and monitors, and operates as mass producers for numerous brand companies, assisted by low labor costs, low-cost transport, and the near commodity nature of the physical inputs (in Compal's case, computer components). Outsourcing entered the business lexicon in the 1980s and often refers to the delegation of non-core operations from internal production to an external entity specialising in the management of that operation. ... Compal Electronics (Chinese: 仁寶電腦股份有限公司) is a Taiwanese Original design manufacturer, handling the production of notebook computers and monitors for a variety of clients around the world, including Dell. ...

Market Research Firm iSuppli issued a report in 2006 which demonstrated that 82.6% of PC notebooks are made in Taiwan by Taiwanese OEM's and ODM's. An original equipment manufacturer (frequently abbreviated OEM) is a company that builds products or components that are used in products sold by another company (often called a value-added reseller, or VAR). ...

See also

• Original Equipment Manufacturer (OEM)
• Pure-Play Semiconductor Foundry