Original Equipment Manufacturer (OEM)

OEM stands for the Original Equipment Manufacturer. This may be a manufacturer of component parts that may be used in the computer. The parts are then modified suitably, refurbished, to suit the specific requirements of another company.

The term is common is used in the IT industry. The term may not specifically relate to the hardware components only but it also refers to the software. It may also refer to any other part as well.

Consider the example of HP, IBM. They are the major manufacturers of the branded systems. But all the components used by them are not manufactured by them. Like the IBM computers may use the processor of Intel Corporation, or even they may use the processors from AMD. There is no restriction what so ever for them unless otherwise there is an authorization.

Similar is the case with DELL, HP, HCL, ACER etc. The use of software like the Windows from the Microsoft Corporation is inclusive of the business specification. The operating system is provided from some other company. Apart from the situation in computer industry, the same system can also be followed in other sectors also.

The importance of this term is also in the VAR – Value Added Reseller. Even a VAR may sometimes be called as OEM. Sometime even the OEM products may be overstock dump. Some of the OEM’s has extended their role to provide the services like the ODM – that is Original Design Manufacturer. It means to describe that the companies that design & manufacture a product which is sold under the brand name.

With any field there will always be some advantages and some disadvantages. As the advantages are obvious the disadvantages will also be made clear in the following section:

• The Products may not have warranty.
• Very small amount of documentation present if any.
• There is actually non existence support.
• Very few accessories and software may be bundled with it.

Usually OEM products may be even the low graded products. But the fact that it can be purchased by low end user and could save you up to 30% of the actual cost.

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