Opportunity Analysis for Outsourcing in the Electronics Manufacturing Service (EMS) Design Market

This Frost & Sullivan research service titled Opportunity Analysis for Outsourcing in the Electronics Manufacturing Service (EMS) discusses the current original equipment manufacturer (OEM) design outsourcing trends, revenue forecast analysis, geographical analysis, and vertical market analysis. The study also identifies new growth opportunities, products and services that can offer increased penetration into design services, and competitive environment.

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Market Overview

Electronics manufacturing service (EMS) providers have evolved from offering point-to-point service to providing complete design support services. As a core strategy, they have started developing focused strategies to broaden design revenues, helping elevate growth in design services. EMS providers are also expected to play a greater role in enabling standardization across all industries, which helps elevate the quality of the product design itself. "Technology innovation, rapid product lifecycles and fluctuating consumer demand are rampant and abundant within the electronics industry, which generates a need for OEMs to showcase their thought leadership and idea generation capabilities," says the analyst of the research. "EMS providers have the knowledge needed to enhance their customers’ design and innovation capabilities, and possess a clear understanding of the associated cost, supply chain, testing and manufacturing flexibility required to ensure a successful product launch for OEMs."

However, some OEMs continue to show a high level of reluctance in outsourcing their designing. For OEMs, the ability to design and innovate is what sets them apart as true differentiators and defines their core services. Consequently, EMS providers have not achieved significant market penetration, particularly in niche industries like medical, aerospace and defense. "OEMs prefer to partner with trusted EMS providers for design and engineering support. Effective branding and permanent support in innovation will be imperative for their survival and growth throughout the forecast period,” says the analyst. "In addition, EMS providers face the challenge of maintaining market shares amid stringent competition from original design manufacturers (ODMs) and, to a certain extent, pure play design companies."

Geographically, the North America and Western Europe markets will continue to lead in terms of design and innovation. However, EMS providers are likely to benefit from impetus from countries such as China and Singapore to promote innovation and research and development (R&D). This is opening up a plethora of untapped opportunities for EMS providers globally.