In a customer’s mind, the difference between “aftermarket” and “OEM” usually boils down to trust. Original equipment manufacturer (OEM) parts are trusted more than aftermarket ones because customers expect them to be built to a certain standard.
They expect reliability, durability, modular (or close) replacement, and widespread availability. If a customer wants to replace the shock absorbers for their General Motors vehicle, for instance, they know they can go to General Motors and get the same level of quality.
However, since most companies often don’t produce every single one of their parts in-house, they turn to outside companies, the actual OEMs, to fill the gaps, which might include anything from product engineering to manufacturing. How, then, do OEMs win over and land their clientele in the first place?
1. Good OEMs Communicate Well
Since another company is reliant upon an OEM to provide them with its parts and products, there must be constant communication between the two to maintain their relationship. An OEM must be willing to share its goals, sales forecasts, supplier information, and manufacturing capability to build the trust its clients need.
If, for example, Bilstein was tasked with providing shock absorbers for the next generation of General Motors’ Chevrolet Corvettes, General Motors would need to know that Bilstein could make shock absorbers to their required specifications, in the amounts needed, delivered on time, and for as many model years as needed.
Bilstein would need to be able to show General Motors they were up to the task by communicating essential information about their manufacturing capacity. Again, the key to a good OEM business partnership is building and maintaining trust.
2. Good OEMs Build Supplier Relationships
Getting raw materials isn’t always as simple as “order X amount from Y supplier.” Suppliers have capacities, too, and it’s possible to exceed them.
Let’s say DiMarzio Guitar Pickups was tasked by Gibson to supply pickups for a new electric guitar. If DiMarzio found out their magnet supplier wouldn’t be able to provide enough magnets to meet Gibson’s requirements, then DiMarzio may have to give up on the potential business venture.
Having multiple suppliers is essential, so it’s up to an OEM to be able to source identical (or nearly identical) materials in order to continue providing their products and designs to their clients. It can be a difficult balancing act, as the OEM must anticipate shortages, shipping issues, quality problems, and changes in raw material availability, and also communicate material changes with their clients through all of this.
3. Good OEMS Stay Current with Industry Trends
By constantly researching the latest news in their industries, OEMs can maintain their ability to serve clients. Industries change rapidly, sometimes due to consumer interests and other times because of new laws.
For example, suppliers of Brazilian Rosewood in the 1960s were suddenly faced with the reality that the wood was becoming a protected species, and therefore unavailable for harvest anymore, which left many manufacturers of furniture and musical instruments scrambling to find a suitable replacement.
OEMs that closely follow trusted resources, trends and best practices can anticipate major changes and offer their clients alternative products or designs and share information about the need for such changes also ensure their clients can communicate the reason for these changes to their customers.
4. Good OEMs Embrace the Move to Digital
Integrating processes into a digital interface streamlines an OEM’s operations. Instead of relying on physical paperwork, the act of transferring all of the OEM’s orders, warehouse tracking, and communication to a digital interface cuts down on errors and increases accountability. Even if there is a significant upfront cost for the transfer to digital, the conversion more than pays for itself in terms of both the time and energy saved.
5. Good OEMs Are Honest
Any company working with an OEM is, of course, thrilled by good news, but it’s also necessary that they hear any bad news when it pops up. If a supplier drops the ball, a design has a flaw, or shipments end up at the wrong address, no matter what the problem, that information must be shared, and OEMs that hide issues will lose business.
Companies want to hear the bad news quickly so they can address it and perform damage control. If a supplied part or product is defective and potentially harmful to customers, companies will need to issue recalls quickly, or the situation could turn dire. By maintaining honesty, not attempting to sweep bad news under the rug, and working to rectify mistakes, an OEM can keep the trust it worked so hard to build.
6. Good OEMS Make Quality Products
Finally, it’s up to an OEM to make products that not only live up to expectations but also exceed them. OEM parts are synonymous with “quality” in the mind of the customer, and OEMs must maintain that image.
From the smallest supplier to the largest global corporate partners, an OEM must always work on keeping its business relationships. Your work isn’t done when winning a contract with a client. Be open and honest, stay up-to-date with trends, and produce quality products, and the clients will be happy to keep the partnership going.