EMS differentiation: Equal opportunity challenge for every contract electronics solutions provider

By Staff

WE SURVEYED 5,000+ professionals employed in contract electronics solutions firms worldwide across all industry markets and representing more than 1,000 different electronics manufacturing services (EMS) firms and all of the top 100 EMS firms.

We wanted to gain an understanding how they perceive their company services positioned in the market compared to how their competitors are positioned and competing against them for similar customers and markets.

We presented the following statement: Describe the competitive differentiation that sets your company apart from other electronics services companies you compete with in the marketplace.

Below, a few of the many responses we received plus, we rate (heavily subjective) each statement, depending on the degree we feel a provider’s response represents real differentiation. (10/10 = they nailed it)

Excuse the grammar and punctuation. We published what we received. We also removed company names.

Keep in mind as you read through these, the low ratings are because what the provider is listing as differentiation is typically not different from what is offered by many other providers they’re competing against.

From the best EMS sales, marketing and business development has to offer

“Contract assembly with internally engineered and manufactured organic or ceramic packages or PCBs with a proprietary library of passive structures and optimized interconnects that minimizes time and expense for custom packages plus an extensive selection of high-performance, off-the-shelf / standard outline packages. Longevity and stability in the microelectronics market for more than 50 years. International engineering and sales support. Off-shore, low cost assembly at our associate facility across the border in Tijuana.” Differentiation value: 3/10

“[company name] is customer focus. Whenever [company name] is committed, [company name] will put investment and resources to help the customer.” Differentiation value: 0/10

“We provide our customers with an unparalleled level of customer service. We are small enough to be nimble, flexible and responsive while still providing the combination of world-class pricing and off-shore manufacturing normally available from only much larger EMS providers. Your program is reviewed at the Executive level EVERY day. Every customer is given the same high level of attention from dedicated Program Management led teams. Our Program Manager compensation is based upon your program success, cradle to grave. Whether it is location, equipment or technology, we have the financial strength to make the investments required to meet the needs of your program and your company. [Company name] plays a pivotal role in the success of our customers. Our catalog of services and global facilities means we provide you with the best solution, no matter how your needs change. As a result, long term, mutually beneficial customer relationships driven by service and cost reductions are the cornerstone of our success. Typical customer relationships exceed 10 years; our customers are our best reference.” Differentiation value: 4/10

Cost models for EMS manufacture outsourcing (and more)


“Small to medium job sizes- highly complex Micro-placement and reflow of bare die, BGAs, QFN, CSPs and flip chips BGA and socket ball attachment LED Assemblies BGA & QFN Rework services QFN removal and replacement Inert gas and Au/Sn processing PCB and CCA repair and modification Die placement and wire bonding.” Differentiation value: 4/10

“Located in China, Strong customer focus team, High quality, competitive price, good service.” Differentiation value: 1/10

Find electronics design services

In your search results you can further target other Industries and/or Services plus, you can add more geographies to your search.

“Personal service, long years of experience, most modern facility.”Differentiation value: 0/10

“[Company name] specializes in serving OEM’s with large product portfolios of ongoing small batch demand.” Differentiation value: 0/10

“Our Lean Operating System has been developed and implemented by a team of executives with significant automotive industry experience. Our lean approach has redesigned traditional electronics manufacturing and has resulted in high customer satisfaction ratings leading to very rapid growth in an industry that has otherwise been in decline throughout North America. We utilize sophisticated equipment in our manufacturing operations, which enables our team to provide synchronous flow manufacturing with a high degree of flexibility. Our Lean Operating System utilizes standardized metrics to ensure consistent performance throughout our facilities. We have standardized on the latest Siemens high-speed vision based SMT equipment with state-of-the-art soldering technology to reduce set-up and changeover times, which is key to efficiently producing low-to-medium volume products in a high-mix environment. Based upon this synchronous flow approach, we have been able to reduce order lead times to days, whereas most providers in the EMS industry require a fixed production schedule of several weeks.” Differentiation value: 3/10

“Vertical integration of PCB and assembly Off-shore costing with local support.”Differentiation value: 1/10

Find Contract Electronics Services Providers

“We could provide not only EMS service, but also PCB. PCBA. FPCBA. Box-Build. System Build. System Integration. JDM. DFX. Turnkey Solution. DMS. R&D. Protoytyping. NPI. LV/HM. MP. RMA. Boundary Scan. SFIS. SMT 01005/uCSP Chip Replacement Capability. Global Certificates for manufacturing Automotive, Medical, Communication electronic products. DFP Cost Reduction Planning Capability. Component Library Sharing System. Industry 4.0 Implementation. JTAG Management, 5 facilities in China, 2 in US & TW, and over +8000 exclusive professionals to assist on building your designed products globally. Yearly average turnover is over 700 millions US dollars.” Differentiation value: 5/10

“Flexible from low to high volumes, offer full consignment and turnkey solutions.” Differentiation value: 0/10

Find product development services

In your search results you can further target other Industries and/or Services plus, you can add more geographies to your search.

“Mid-size CM focusing on Customer Satisfaction in providing complete solution in both our US and China facilities. [Company name] offer Engineering Services to ensure product manufacturability that will result in high quality products. [Company name] provides innovative methods for reducing procurement, manufacturing and delivery lead times.” Differentiation value: 1/10

“Advanced design and manufacturing technological level, high yield for complex products, well invested plants with added high customer service standard.” Differentiation value: 0/10

Operations due diligence for EMS
Financial due diligence of EMS
Discovery vs due diligence when selecting EMS partners

“Strong material/procurement management system Ruggedized assemblies.” Differentiation value: 0/10

1. Customer focus
2. Experienced staffs
3. Quality management systems
4. Top class products and services
5. Strategic Partnership with component vendors
6. Apply client approved components ONLY
7. Buy from component manufacturer or their majors ONLY to ensure originality”
Differentiation value: 0/10

“Low cost labour force, Production site is situated in EU, Modern equipment, SMT stencil manufacturing at site.” Differentiation value: 0/10

“[Company name] is one of the largest “domestic” PCB design engineering and assembly service firms. We provide electrical engineering solutions for hardware schematic design, PCB layout, thru turnkey prototype manufacturing assembly of the PC boards.” Differentiation value: 0/10

Find SMT / PCB assembly services

In your search results, you will be able to further target provider options by choosing End Markets and/or other Services.

“Support quick-turn prototypes through production volumes. World-class facility with advanced manufacturing equipment supported by leading edge information systems. Degreed test engineers and test assets that include flying probe, ICT, and environmental chambers and vibe.” Differentiation value: 1/10

Disclosure vs discovery

Lack of differentiation comprehension, or at least, the inability to articulate differentiation, was not left to smaller firms. Even tier-1s stumbled on this.

We encourage OEMs to ask their current and prospective EMS partners how they perceive their differentiation in the marketplace from other provider they’re competing with serving similar industries, offering similar services and managing similar geographic locations.

Where differentiation remains vague among EMS firms price will continue to be a deciding factor for OEM decision-making when choosing from competing provider quotes.

OEMs should ask more probing questions to get providers to reveal more than just their service offerings.

This lack of clear differentiation by EMS firms can also explain maybe why EMS firms express frustration why OEMs remain price sensitive. Most EMS firms bring this on themselves for not effectively identifying and articulating their value proposition. If EMS firms don’t create their own story, OEMs will tell it for them with their decision-making.

Find EMS providers in 3 steps

We also encourage OEMs to ask providers; What are you doing specifically to measure management and worker productivity, minimize inefficiencies and waste across departments and, hold EMS employees supporting production of my programs accountable?

We end with this. From a website of another tier-1 EMS provider. Many, many other providers can claim these same capabilities as each differentiator is worded below. EMS marketing is void of critical sense.

Differentiation value: 1/10


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