All contract electronics manufacturers are looking for new customers, the question is: how to find the right union between original equipment manufacturer (OEM) and contract electronics manufacturer (CEM). Like all relationships, this is simultaneously both simple and complicated.
In an ideal world, the CEM’s perfect customer gives annual fixed orders for the whole year, makes no engineering changes and pays in 15 days. On the other hand, the perfect OEM supplier will keep stock, require no commitment and make engineering changes immediately.
Does the ‘perfect’ CEM or OEM ever exist? Highly unlikely! The definition of perfect is driven by one’s expectations. From experience, Texcel Technology has found that communication and openness are key factors in making a successful OEM/CEM relationship.
Understanding each other’s expectations can resolve common problems and ensure a good match. Just like a successful marriage, tried and tested systems of communications can be put in place, leaving some room for those intuitive conversations that take a relationship to a deeper level of understanding.
The first date
Texcel tries hard to establish business relationships with new customers where a mutual benefit exists for both parties. Typically customers have their design centre in the UK, with a good proportion of their sales being exported and a diverse product range that requires flexibility in supply. In turn, customers tell us that agility of supply, quality and additional value added services are important to them.
We get on well with all our customers, but is that down to the luck of a blind date or the less romantic route of an arranged marriage? In the CEM business, Texcel opts for the arranged marriage, where both parties are as compatible as possible from the start of the relationship.
Texcel builds its relationships supported by normal business terms with rights and obligations on both sides. Right from the start we are objective about analysing expectations and abilities to manage expectations. This is achieved by being open, frank and not over promising or skimming over problems that could become major issues, potentially ending with a messy business divorce.
For any OEMs out there looking at sourcing assemblies, the advice is simple: First, be clear about what your company needs from a CEM; secondly, be honest about where your limitations are; and finally, think about whether your team can work with the staff of the CEM, because when there are issues, you need to look them in the eyes and work together.
If you can get all those components right, you could be on your way to a marriage made in heaven.