Not all our clients know that there are several different ways to develop your product and bring it to market. In the majority of cases, there are already similar products on the market. If the manufacturer is located in Asia, they are often happy to produce a similar version for you. We created this article to give insights into the different ways you can develop (electronic) products and the advantages and disadvantages of each of these methods. At SLIMDESIGN, we support our clients regardless of the route they choose to take. The most suitable option depends on their requirements, volume, and budget.
Content:
Maker platform
OEM
ODM
Custom product
Conclusion
1. Maker Platform: Very low volume (up to 20)
If you are building an internet of things device in a very low quantity (less than 20 pieces), we recommend using a maker platform, like Arduino or Raspberry Pi. This makes it easy to combine and swap components, iterate, and come up with new ideas on the go. The outcome can be used to showcase an idea but is not comparable to a scaled-up product. For example, an Arduino is often bigger than a custom PCB. If you decide to go with this method, you should also realize that the code, configuration of components, and volume will all have to be redesigned if you want to scale up the production volumes afterward. For that reason, we often skip this phase and start with mass-production suitable chipsets and components.
Advantages:
- You can do it yourself and iterate quickly.
- It will help you get future requirements right
- The result will help to explain the idea to stakeholders and investors
- Cheap if you only need a few in a static controlled environment.
Disadvantages:
- Impossible to scale feasibly
- When decided on manufacturing, a lot of work needs to be redone.
2. OEM: Same as an existing product
There are a lot of companies (Original Equipment Manufacturers, or OEMs) already producing products that can be branded with your logo. Finding the right product that suits your needs and made by a manufacturer that can be trusted, can be time-consuming. We have supported clients in this process when they need small quantities and have a limited budget. Having the right contacts with good and reliable partners in Asia is an advantage when choosing the OEM route.
Advantages:
- Ideal if the product is available or when you only need small changes.
- Minimal development costs
- Small MOQ (Minimal Order Quantities) are possible
Disadvantages:
- Limited modifications possible
- The same product will be sold to others
- The firmware, API, APP, etc. are often not very well executed
- The product might have changed when you place a new order
3. ODM: Similar, but different from an existing product
If you want an original design but your development budget is limited, working with an ODM (Original Design Manufacturer) can be a solution. In this case, their standardized electronics are used to save costs. You can create the design and define the requirements. They will do the final engineering under your supervision. The downside of an ODM is, that their focus is production: they do not like modifications. If you do not order big enough quantities, they lose interest and you can expect long delays. Optimization of the software is hard because they will not give you excess to it.
Advantages:
- The development budget is relatively small
- Lower product cost price because they can order the components in large quantities
Disadvantages:
- No access to the lower level software
- Optimizations are not their priority and will take a very long time or it will not happen
- Hard to avoid lock-in, you cannot move to another production partner
- Expect changes over time in the components, quality, and price
- They often require a minimum order quantity per year
4. Custom Development: New custom product, full control
With a custom electronic design, you control all aspects of the product: user interface, hardware and software. In this way, you can make a premium product that is finetuned to the needs of your customer.
Advantages:
- Full ownership of the Intellectual Properties (IP)
- Less risk you are educating the competition
- Full control over component selection and configuration
- Low-level control of the software to optimize the functions
- Security and software updates are easily managed
- Production partner change is easier (second sourcing is possible)
Disadvantages:
- Longer development time and bigger budget required.
Our advice:
The best approach for your project is not always clear. We would be happy to give free advice and we have a feasibility study where we investigate all these options and kickstart your project.
