You probably have a favorite pair of shoes. Your footwear—especially the most comfortable pair in your closet—was designed with a purpose; construction, hiking, backpacking, running, walking, dancing, etc. But, the person who designed those shoes didn’t create the materials—the rubber, fabrics, treatment, materials, etc.
Each of the product’s integral pieces is created by another part of the industry.
That’s the difference between a contract manufacturer and an original equipment manufacturer.
Contract Manufacturing vs. Original Equipment Manufacturing
The rubber, textile, and fabric treatment components that go into your favorite kicks are all examples of products manufactured by original equipment manufacturers (OEM).
According to Tech Target, by definition:
“OEM (original equipment manufacturer) is a broad term whose meaning has evolved over time. In the past, OEM referred to the company that originally built a given product, which was then sold to other companies to rebrand and resell. Currently, the term is frequently used to describe companies in the business of rebranding a manufacturer’s products and selling them to end users.”
So what does this mean?
It means that an original equipment manufacturer, ignoring certain nuances, is the company that originally makes different parts. Say, the rubber soles on your shoes. They then sell those rubber soles to the bigger brand company (let’s say Nike) who attaches the soles to the shoe and sells the whole thing as a singular product.
An OEM is a fully integrated firm that designs, manufactures, and sells its brands under registered trademarks. An example: your waterproof rain jacket or hiking shoes might be denoted with the label, “Gore-Tex” protection. W.L. Gore & Associates, Inc. is best known for its GORE-TEX waterproof/breathable fabric, and the corporation contracts a long queue of technical apparel and footwear solutions to countless other brands and companies in the market.
The product provided needs to reach a consistent quality and standard, and the expectations of the customer must be met, much like the equipment created by General Kinematics.
Comparatively, contract manufacturers produce proprietary products for other companies. Contract manufacturers provide in-house designs, formulas, or specifications and then the contracted manufacturer completes the production process.
The Evolution of Contract Manufacturing
Back in the day, contract manufacturers supplied standard parts and components. As manufacturing evolved, the process advanced with assembly equipment and testing capabilities. Contract manufacturers were then able to increase the output, produce components that were more advanced, and tailor products to meet particular market or client needs. And, when a product is developed based on consumer needs—similar to a pair of work shoes or rain jacket—the value increases substantially.
This market evolution has also led to a decrease of cost production for U.S. market-based firms, as well as other markets around the globe that partner with contract manufacturers in a high-volume, low-cost model, according to Alternative Manufacturing Strategies.
General Kinematics Is an Original Equipment Manufacturer
General Kinematics is set apart through its OEM because we gain expertise by remaining focused on our designs. We are the GORE-TEX of the foundry world. We also make sure that every single piece of vibratory and rotary equipment manufactured reaches a consistent and high standard, and that we completely fulfill the needs of the customer.
