OEM products is an easier way to scale your business because you will have control of most of the operations. Lets look at the OEM pros and cons. It is a step up from just drop shipping products.
SUMMARY
- More control with your business.
- More capital to sell OEM products.
- Business may need more support in operations.
PROS
There are many pros to selling OEM products. You will have more control over your operations because you are purchasing products from manufactures directly. While they can provide your branding on the product, you will likely need to do addition packaging and the actual delivering of the products. It is better than drop shipping when it comes to having a relationship with the manufactures because they know you mean business when you are purchasing more products at once.
CONS
The cons of OEM are that it may be harder to start at this step. If you are not really invested into the business or have not done enough research into the market you are entering, you may be stuck with a large amount of inventory and no customers to sell to. In addition, you are taking a larger risk than drop shipping because you need to spend more money in the operation costs including everything from drop shipping, packaging, supplies for packaging, deliveries, and any addition services you would want to provide.