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EMS provider manufacturing equipment continuity is postured marketing

By VentureOutsource.com Staff

EMS providers are known to artificially enhance marketing their services to prospective customers that is beyond EMS provider actual capabilities, hoping to close the gap after the ink dries. This is especially true as EMS providers are starting to include machine learning and artificial intelligence, for SEO purposes, on their websites. (For actual findings of 1-year study of artificial intelligence in EMS industry, go here)

EMS providers often talk about continuity among their factories. Despite fear by all EMS providers of of losing customers, one European EMS provider is claiming it uses “the same equipment in all of its factories around the world.”

This claim has limits. While EMS providers may use the same equipment manufacturer brand, per equipment type and/or function, its not the “same equipment” as claimed.

Here’s why. EMS CapEx technology comes in cycles, and no two EMS factories in the same EMS provider budgets for updating a complete line of SMT/PCB assembly equipment at one point in time. Each EMS production manufacturing assembly piece of equipment has an ideal, working life span depending on what the machine does which can vary based on usage and maintenance and servicing upkeep.

Some pieces of equipment within the greater, full production PCB assembly line comprised of various types of equipment, will also require replacement sooner than others, whether based on wear and tear, new technology, neglect and increasing maintenance costs, etc…

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In your search results, you can further target EMS provider options by choosing more End Markets and/or other Services and more geographies.

EMS providers budget amortization carefully and, machine equipment manufacturers align their equipment sales and release of new models based on market demand and technology innovation, not the whims of one EMS provider.

The next time an EMS provider makes such a claim about having the same equipment across all of its factories, we encourage OEMs to ask that EMS provider to provide a list of the date each piece of equipment was installed on any given production line.

EMS providers will make the claim of same equipment because they want to use it as a selling point, telling OEMs the EMS provider can easily transfer OEM customer programs from one factory to the other with each.

EMS providers are afraid of losing OEM customers. Contrary to what EMS providers claim, providers do not procure OEM program MCOGs against large volume purchases for better PPV. EMS providers do not yet have this technology and OEM programs are carefully managed by EMS providers in walled off silos or shoe boxes.

EMS providers know their typical OEM customer has no less than two or three EMS partners and, OEMs will pull business from one EMS provider and move to another if the OEM knows they can save on costs.

Stickiness among OEM customers has declined dramatically in industry, especially as EMS provider services commoditization has taken hold, with little differentiation among EMS providers targeting similar end markets.




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