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Original Equipment Manufacturer (OEM)

Also known as: OEM

An original equipment manufacturer (OEM) is a company that produces parts or products that are used in, or sold as, another company's finished goods.

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An OEM makes the components or complete products that other businesses buy — sometimes to build into their own products, sometimes to resell under a different brand. In procurement, buying OEM parts means sourcing genuine components made by or for the original producer, as opposed to third-party or aftermarket equivalents.

OEM sourcing matters where fit, warranty and reliability are critical, such as machinery spares and electronics. Buyers weigh the assurance of OEM parts against the often lower cost of compatible aftermarket alternatives, considering warranty terms and total cost of ownership.

Frequently asked questions

What is an OEM?
An original equipment manufacturer (OEM) is a company that produces parts or products used in, or sold as, another company's finished goods.
What is the difference between OEM and aftermarket parts?
OEM parts are made by or for the original producer and match the original specification, while aftermarket parts are made by third parties as compatible alternatives, often at lower cost but with varying quality and warranty.

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