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Electronics Industry Survey Studies OEMs
August 28, 2006 |Estimated reading time: 1 minute
SAN JOSE, Calif. Venture Outsource, an electronics outsourcing strategy firm, announced key findings from its online survey, "Eyes on Electronics Outsourcing Industry 2006," noting fast-growing electronics market segments. The survey also found that the majority of OEMs outsource, which helps them reach cycle-time requirements. EMS providers and ODMs find engaging new business areas challenging.
The majority of OEM survey respondents provide products or services to industrial, networking infrastructure, consumer, military and defense, avionics and aerospace, automotive, and medical electronics markets. They indicated EMS providers and ODMs such as Solectron, Flextronics, Foxconn, Celestica, and Benchmark Electronics as business affiliates. While many EMS/ODM companies polled indicated an understanding of their OEM customers' market cycles and product technologies, the OEMs did not all agree with that statement.
The survey shows that 63.7% of OEM companies currently outsource. Technology applications identified to increase lean manufacturing for OEM, EMS/ODMs, and supplier companies include Internet portals, manufacturing floor management systems, ERP applications, customer relationship management (CRM) tools, and product lifecycle management (PLM) software. OEMs identified reducing new product introduction (NPI) time as a key business objective.
The survey also assessed the effect of China-based vendors in company supply chains, as well as other regions for outsourcing design and manufacture. India was rated well for design, while respondents felt that Mexico performed higher in manufacturing.
OEM survey respondents indicated that they believe the percentage added to an outsource providers' profit is higher than what outsource providers indicated. Management practices of ODMs and EMS providers were discussed.
Other industry areas examined include periods throughout the year when request for quote (RFQ) and request for proposal (RFP) activity increases between OEMs and outsourcing partners, according to end-market sector.
Several hundred OEMs, EMS providers, ODMs, and suppliers completed the survey worldwide. The majority of OEM respondents hold managerial or director-level positions.