What is an Original Equipment Manufacturer (OEM)?

August 17, 2023

What is an Original Equipment Manufacturer (OEM)?

We’ve taken a deep dive into the benefits and constraints of partnering with MSPs and VARs to outsource device lifecycle management in “What is a Managed Service Provider (MSP)?” and “What is a Value-Added Reseller (VAR)?”, respectively. Now, we’ll put original equipment manufacturers (OEMs) under a microscope.

A 2023 Robert Half survey found that a staggering 79% of younger workers who currently work remotely would look for another job before returning to the office full-time. To attract Gen Z talent and keep millennials engaged, distributed work isn’t going anywhere—whether that model is hybrid or fully remote, employees still crave and expect flexibility. Since distributed work has changed the processes for IT ops and supply chains, internal IT teams need a new blueprint.

If you’re relying on OEM partners to provide and manage your employee’s corporate devices (e.g., laptops, monitors, peripherals like headphones and mice), you must make sure they can provide sufficient services to support a global organization.

Benefits of OEMs

But first, what is an original equipment manufacturer? They are mainly known in the automotive and computer industries. To put it simply, they manufacture the components (OEM hardware and OEM software) of another company’s products. Were you aware, for example, that every individual Dell laptop part isn’t necessarily manufactured by Dell? Their operating systems (OS), hard drives, and processors could be developed by an OEM, such as Intel.

An original equipment manufacturer is the first critical step in creating the components used in another organization’s final product—but not usually the last. OEMs typically partner with value-added resellers so that the VAR can sell the OEM’s components to end-users with beneficial feature add-ons. As the name suggests, this partnership is a major value-add for customers as OEMs themselves do nothing “extra” beyond making and selling parts—some OEM parts even have their own brand name and own product logo on them.

          • High Quality: You’re getting a like-for-like original part (or replacement), increasing the lifespan of your equipment

          • Flexibility: Compared to an original design manufacturer (ODM), which offers private labeling and therefore is beholden to their customer’s specifications, an OEM has more variability in offerings

          • Competitive Pricing: While they may be more expensive than aftermarket products (which are generic replacement parts and not guaranteed to function as well), OEMs still have competitive pricing—especially if the VAR partner buys in bulk. Microsoft is another cost-saving example; they allow Windows, their OS, to be used by OEM computer manufacturers via the bundling of Microsoft Windows—these product keys are priced lower

          • Efficient Repairs: End-users will inevitably need a software upgrade, get a broken computer fixed, or replace a device outright. OEMs can address these changes in an agile way since they have the original design plans, molds, and measurements—the parts are built quicker, so they arrive quicker

Capabilities to Assess When Choosing Your Original Equipment Manufacturer (OEM)

Different OEMs work differently from each other; Intel, Foxconn, and Lenovo do business with different value-added resellers (VARs) and third-party logistics providers (3PLs), and those VARs and 3PLs in turn have their own unique capabilities and limitations. Here are all the considerations you should be making when picking your next partner.

Remember: The seller of the finished product is the VAR, so you would most likely be partnering with a VAR as well. Some OEMs operate exclusively as a component provider, while others serve as an organization’s (e.g., the end-user’s) primary product manufacturer. It's up to the individual OEMs to confirm with their VAR partner(s) what their joint business model looks like. You can explore the benefits and limitations of VARS here.

Global Device Procurement

Yes. This is an OEM’s bread and butter! When seeking new products for your distributed workforce, it’s important that you work with partners that can support a global supply chain.

The alternative? Doing this all in-house... which gets really complicated, really fast. Each country has a different playbook. These are just some of the variations procurement partners have country-to-country:

          • Do you buy local or import?

          • What’s the lead time for this? What about for custom orders?

          • Which resellers do you partner with? Do they operate in all the countries I need to service?

This doesn’t even scratch the surface of other variables, like stock volatility or even the physical characteristics of the device itself (e.g., keyboard alphabets, charger heads). So, it’s a relief that you can outsource this critical part of the supply chain to OEMs.

Peripheral Procurement

This offering depends on who you work with. All OEMs will typically offer keyboards, mice, docks, and monitors. Other peripherals like headsets or external webcams need to be inquired about, as this isn’t offered across the board. This means IT teams may need to manage the procurement (and individual deliveries) themselves. After all, without an office, employees can’t just stroll into the IT closet.

Furniture Procurement

Furniture is rarely offered by OEMs, but maybe the big ones have a special partnership so it’s still worth inquiring about. This was something workers didn’t have to think about when going into an office every day, but when you consider that 41% of remote workers have reported “new or elevated” pain, this offering is increasing in importance.

Employee Self-Service Interface

Allowing your employees to choose their own device (or request peripherals) in a self-serve portal is not something an OEM manages. If your organization wants this type of functionality to streamline requests, it will have to be customized by your in-house IT team. This type of portal is useful when a company is managing multiple requests from multiple locations: repairs, updates, new hire equipment outfitting (onboarding), retrievals (offboarding), the list goes on. This greatly centralizes device lifecycle management.

Centralized Inventory Management

Having a central hub to view the real-time status (e.g., deployed, needs repair, etc.) and location (e.g., at the warehouse, en route to employee, etc.) of your used and new inventory is table stakes in today’s remote world.

For one, poor inventory tracking causes compliance issues long-term. Not properly logging inventory counts for new, returned, and repaired devices is a security risk because not knowing the location of a device means not knowing where business-sensitive or personal identifiable information (PII) data is.

For another, centralized inventory management makes responding to change management easier. Making a major hiring push? You need to know what and how much is available at each of your storage locations so every employee gets the equipment they did. Downsizing, or went through an M&A? You need to know which devices are returned to the warehouse, when they got there, and if they are ready for redeployment.

Unfortunately, this is not managed by the OEM. If you want to create a single source of truth, you would have to build out this capability yourself. Otherwise, you are stuck with manual tracking that is prone to error. Did you know that 30% of IT assets are "ghosts”, meaning you’re paying for something that you don’t have but are claiming on an asset list that you do?


OEMs often store through their partners. If you would like your IT admins’ home closet to stop acting as the storage unit for your company, these are some recommendations you need to consider when building out your warehouse footprint:

          • Hold devices in strategic locations (aka near your workers)

          • Maintain a minimum level of inventory, and discern how much that is for each location based on your hiring needs

          • Assess each warehouses’ dock to stock time—24 to 48 hours is the ideal

          • Be aware of each warehouses’ cutoff times for same-day and expedited shipments

          • Ensure they partner with a National Institute of Standards and Technology (NIST) compliant organization for proper disposal of your end-of-life devices

The VARs that OEMs partner with have geographic limitations. You’ll either need to invest in multiple VARs (or separate business units of one VAR) to service your various geographies individually.


This service is rarely offered by OEMs, so the onus falls on your in-house IT team.

There are two ways to image a device—that is, install corporate apps/computer software. The first is monolithic imaging, which is a manual process that requires an IT professional insert a USB to each individual device for installation. The second is preferred, particularly for equipping remote and hybrid employees, and referred to as “zero-touch”. This allows the imaging to be done remotely.

In some cases, organizations cannot achieve zero-touch due to current business practices (e.g., some necessary apps are not hosted in the cloud and therefore cannot be imaged remotely) or industry regulations. This just makes it more time-consuming for your in-house IT team since OEMs do not offer this kind of technical support.

Onboarding (Ship to Employee)

Before the rise of distributed work, bulk orders would be delivered to a single office location. Remote work has made some tasks more complex for IT. When employees are no longer hired based on the corporate HQ’s address, IT is responsible for shipping equipment requests to any location, anywhere in the world.

Some OEM companies will thankfully ship directly to your employees, but not all of them do. This is an important factor to keep in mind, especially if you have a small IT team. Do you really want one person to have the spend the typical 5 hours per remote worker to manage this?

Repairs and Replacements

As mentioned in the Benefits section, repairs are where OEMs shine as a manufacturing company. OEMs sell repair packages as part of their device contracts. Since they can quickly reproduce the original product design of replacement parts, this lets end-users enjoy a longer lifespan of their equipment. OEMs also offer great warranty services alongside their VAR of choice.

Offboarding (Retrievals)

This is rarely offered, since OEMs are not incentivized to take inventory back in. Retrieving laptops, monitors, and other necessary assets from departing workers for cost-saving reuse was difficult even when everyone was in the office. Can you imagine how hard it is when the IT person requesting the laptop back lives in a different country from the departing employee? Maybe that’s why industry analysts we have spoken with have shared with us that companies lose roughly $67.5K in laptops alone, annually.


Again, since OEMs are neither built nor incentivized to take inventory back in, they do not manage the wiping of a returned asset. And if your organization cannot leverage zero-touch imaging, IT will then need to re-image the device after wiping. This just adds to the manual, time-consuming work that IT will need to manage instead of focusing on things that drive the business forward.

Disposal / Recycle

Original equipment manufacturers usually have an IT asset disposition (ITAD) partner to handle disposal of end-of-life devices. Some OEMs even handle it themselves. To ensure compliance, the OEM hardware is physically destroyed so that it is unusable and the data is unrecoverable.

Process Integrations

Integrations are often custom-built and specific to each provider. To reduce time-consuming administrative tasks, it’s recommended to find ways to automate. We have two key recommendations:

To make it easier to stay compliant, integrating into an IT Asset Management (ITAM) automatically pushes any changes to your devices (like its condition). This relieves your internal teams the pain of having to manually import data and dealing with back-and-forth questions to the warehouse. Integrating into a Human Resources Information Systems (HRIS) streamlines the new hire process exponentially as well.

Ongoing Support Services

Yes, OEMs will have some sort of support or help desk. Just be aware that this will probably be at an additional cost.

Is Relying on an OEM the Best Option for Outsourcing Your Remote Employee Equipment Lifecycle?

OEM products are high-quality and have competitive pricing, especially when compared to cheaper aftermarket parts. Since OEMs do not really provide services beyond making and selling a component of the end product, they partner with value-added resellers. Unfortunately, for the most part, VARs are not built to support the device lifecycle needs of a distributed workforce.

OEMs are great for procurement and repairs, but we would not suggest relying on an OEM/VAR to manage your fleet of company equipment for remote and hybrid teams.

Here’s why:

          • No employee self-service capabilities

          • Difficult to centralize device lifecycle management, as there is no real-time inventory tracking

          • Manual imaging is your responsibility, which creates lag times in delivery and redeployment

          • Doesn’t cater to the full lifecycle—not responsible for redeployment or asset retrievals

With Firstbase, you get all the benefits of an OEM—particularly outsourcing low-value procurement and logistics tasks—without the gaps in feature offerings. Take a guided tour to check it out.