OEM cash in advance EMS manufacturing

By Staff

Some EMS providers can drive customers crazy with frequent periphery costs. And while publicly traded electronics OEMs tend to focus more on cost reductions than private firms, EMS program management can drive good revenue streams off customer programs because of these costs.

Sometimes OEMs bring this on themselves depending on program requirements: build-to-order OEM programs under $’n’ million in size and below a minimum threshold for many EMS providers therefore providers are telling OEMs they won’t allocate a dedicated team to your program.

And if you are placing work orders only a few times a year the EMS provider can forget particulars about your program, which adds to complexity in the OEM-EMS relationship for both parties and can impact product quality.

More work for OEMs

So, OEM programs with mixed technology and lots of proprietary parts, SoC and older product/tech designs, some box-build high level assembly (HLA) requirements, and long product sales cycles need to work harder to be attractive to potential EMS firms or risk EMS providers opting out participating in the OEM’s RFQ phase.

One way OEMs can help get potential EMS partners to commit includes being open to cutting change orders and adding to your AVL to make things easier for EMS providers to get through their materials acquisition cycle. EMS providers, in general, want to clear a kit and get it to the production floor fast.

Yet every OEM seeks high quality EMS partners who is well run and can manage through these challenges.

OEM cash in advance payments also don’t hurt.

Private message OEM peers. Access all content.

For electronic OEM professionals working in OEM companies. Connect with OEM peers and access exclusive content.

Add your comment


Leave a Reply

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

TIP: Anyone can post article comments whether or not you are registered. But, if you register or log in you can attribute your posts to your user profile in GlobalNet Community.

Your email address will not be published. Required fields are marked *



You might also like:

OEM Checklist for EMS Manufacturing Quotes

Provider spotlight

About is the leading online destination helping electronics OEM decision makers make more informed decisions and reduce risk. We offer educational Webinars, thousands of original articles and helpful tools, a community of influencers who understand the challenges facing your company today, and a comprehensive directory of electronics provider services.

Copyright Venture Outsource, LLC. All Rights Reserved
The material on this site is for informational purposes only and is not a substitute for legal, financial or professional advice. Distribution and use of this material are governed by our User Terms Agreement and by copyright law. By using our Website you agree to site Terms and Privacy policies. For questions please contact at 1-888-860-1193 or visit