OEM, ODM or private label: what is the difference?
Private label is about whose brand is on the pack: PLMA says private label products "encompass all merchandise sold under a retailer's brand". OEM and ODM are about who designs. An OEM makes to its customer's specifications; an ODM designs the product and usually keeps its intellectual property. Of 443 manufacturers on NordSourced, 16 name OEM as a service.
What does private label mean?
The product carries the seller's brand, not the manufacturer's. PLMA, the Private Label Manufacturers Association, writes that "private label products encompass all merchandise sold under a retailer's brand". Its US site puts it simply: store brands "carry the retailer's name or private brands". PLMA calls brands owned by wholesale buying groups controlled labels.
PLMA's definition is about retailers. In wider use the term covers any company that sells under its own brand: Wikipedia, a tertiary source, describes private label as "a brand owned by a company that directly sells the product, but outsources the manufacturing to a third party". NordSourced uses the term in that wider sense, for brand owners and online sellers too.
What do OEM and ODM mean?
OEM stands for original equipment manufacturer and ODM for original design manufacturer. Wikipedia, a tertiary source, defines an OEM as "a company that produces parts and equipment that may be marketed by another company", and an ODM as "a company that designs and manufactures a product for another company (its customer) to sell".
Wikipedia notes that OEM is ambiguous and sometimes used interchangeably with ODM. NordSourced found no EU, WIPO or standards-body definition of either for consumer goods. The difference that matters is who designs: an OEM makes a product to the specifications of its customer, while under an ODM agreement the manufacturer usually keeps the intellectual property unless the customer buys it outright.
How do OEM, ODM, private label and white label compare?
By who designs the product, who owns the design or formula, whose brand is on the pack, and whether the manufacturer may sell the same product to others. The table sets the four terms side by side as the sources above describe them. Read it as trade usage, not law: NordSourced found no EU act that defines them.
| Model | Who designs the product or formula | Who owns the design or formula | Whose brand is on it | Can the manufacturer sell the same product to others? |
|---|---|---|---|---|
| OEM (original equipment manufacturer) | The customer sets the specifications; the manufacturer makes to them | Not settled by the term; write it in the contract | Usually the customer's: the product may be marketed by another company | Not settled by the term; write it in the contract |
| ODM (original design manufacturer) | The manufacturer designs it | Usually the manufacturer, unless the customer buys the design outright | The customer's | Yes: it can sell the same product to competitors |
| Private label | The client sets the specifications; the manufacturer may develop the formula to them | Not settled by the term; the agreement decides | The seller's or the retailer's | No: made exclusively for one client |
| White label | The manufacturer sets the specification | The manufacturer | Each client's own brand | Yes: several clients may sell it |
The cost of ODM: speed, paid for with a design the manufacturer usually keeps and may sell to your competitors. The cost of OEM: you need a finished specification before the first quotation. The cost of white label: the same product may be on sale under other brands. The cost of private label with development: development stages and charges, and an ownership clause to negotiate.
Who owns the formula or the design?
The contract decides, not the word OEM or ODM. The EU IP Helpdesk describes an assignment as "generally understood as a permanent transfer of ownership", while "an IP licence is usually comparable to a rental; it does not imply the permanent transfer of the IP in question".
The Helpdesk's chapter on research agreements adds that "background IP remains the property of the party that generated it". That chapter is about research with universities, not factories, so read it as a question to settle rather than an answer: whose existing formulas does your product use, and who owns what is developed for you?
Ask for the answer in the agreement: ownership of the formula or design, access to its documents, whether other brands may buy the same product, and what you receive if you move production. The private label, white label or contract manufacturing guide and what a manufacturing agreement should contain cover the clauses.
How do manufacturers in Northern Europe describe themselves?
Mostly as private label and contract manufacturers. Of the 443 manufacturers listed on NordSourced, 249 name private label on their own website and 246 contract manufacturing. 16 have OEM among the services NordSourced records, and 1 uses the word ODM. A manufacturer can name several services, so the rows overlap.
| Service | Manufacturers naming it | Share of all listed |
|---|---|---|
| Private label | 249 | 56% |
| Contract manufacturing | 246 | 56% |
| Custom orders | 107 | 24% |
| White label | 71 | 16% |
| Formulation & R&D | 56 | 13% |
| Packaging design | 46 | 10% |
| Regulatory support | 21 | 5% |
| OEM | 16 | 4% |
| Manufacturer | Country | Product groups | In its own words |
|---|---|---|---|
| AIRLAX | Lithuania | Home textiles | “We operate under international cooperation models such as OEM / ODM / Private Label , ensuring full quality control, production stability, and technological precision at every stage.” source |
| Eurobio Lab | Estonia | Cosmetics | “EuroBioLab is a European cosmetics manufacturer specializing in private label and OEM production. With over 13 years of experience, we develop, manufacture and package high-quality beauty products for brands in more …” source |
| H2O4U Finland | Finland | Food & beverages | “A trusted OEM and packaging facility, delivering premium natural mineral water from Lahti, Finland.” source |
| ISM Furniture & Interiors | Latvia | Furniture & interior | “We offer private label / OEM furniture production services for designers and furniture brands, as well as custom commercial furniture solutions for the retail, hospitality, and commercial sectors.” source |
| IVO | Lithuania | Furniture & interior | “IVO — mattress manufacturer in Lithuania (EU) for OEM & private label” source |
| Lāma | Latvia | Furniture & interior | “We provide complete OEM and private label manufacturing services for furniture and interior products.” source |
| Lami Super Booster | Estonia | Cosmetics | “Lami Super Booster is a premier OEM manufacturer of private label brow lamination kits for beauty brands, educational centers, and salons.” source |
| Safeplast | Finland | Other | “We do also produce original OEM products for several brands.” source |
| Selka | Finland | Furniture & interior | “OEM Manufacturing Partner” source |
| Selka4resellers | Finland | Furniture & interior | “We serve as an OEM manufacturing partner for furniture companies.” source |
| Skarvin | Estonia | Furniture & interior | “Pakume kontraktitootmist mööblibrändidele (private label / OEM), kinnisvaraarendajatele (köögid ja sisseehitatud mööbel uutele projektidele) ning disaineritele/arhitektidele, kelle joonised soovitakse seerias tootma …” source |
| Starsprings Sweden | Sweden | Furniture & interior | “Pocket springs engineered for comfort and durability — a global manufacturer and OEM supplier for beds, mattresses and commercial vehicles, innovating better sleep since 1918 .” source |
| Valio | Finland | Food & beverages | “We provide OEM services for developing, manufacturing, and marketing high-quality infant nutrition products, available in various packaging options.” source |
7 of the 13 manufacturers whose quoted sentences use the word OEM make furniture and interior products, so in this directory OEM is mostly a furniture word. 7 of them use OEM and private label in the same sentence.
Which model does your product and plan decide for you?
What you bring decides the model. A finished specification or formula points to OEM or contract manufacturing; an idea without a formula points to private label with development, or to an ODM design; a launch with a proven product points to white label. Whether the design must be yours alone decides between ODM and private label.
- You have a formula or a technical drawing: OEM or contract manufacturing. 246 listed manufacturers name contract manufacturing.
- You have an idea and need the product developed: private label with formulation work. 56 name formulation and R&D; see manufacturers that develop the product for you.
- You want a product the manufacturer already makes, under your brand: white label. 71 name it.
- You need the design to be yours alone: avoid an ODM design you cannot buy outright, and ask for an assignment in the contract.
Questions and answers
Is OEM the same as private label?
Not quite. Private label says whose brand is on the product: PLMA describes private label products as merchandise sold under a retailer's brand. OEM says who designs: an original equipment manufacturer makes to its customer's specifications. A product can be both, and 7 manufacturers on NordSourced use OEM and private label in the same sentence about their services.
What does ODM stand for?
Original design manufacturer: a company that designs and manufactures a product for another company to sell, in the definition of Wikipedia, a tertiary source. Under an ODM agreement the manufacturer usually keeps the intellectual property in the design unless the customer buys it outright, so it can sell the same product to other customers, competitors included.
What does OEM stand for?
Original equipment manufacturer. Wikipedia, a tertiary source, defines it as a company that produces parts and equipment that may be marketed by another company, and notes that the term is ambiguous and sometimes used interchangeably with ODM. NordSourced found no EU or standards-body definition for consumer goods, so ask a manufacturer that uses the term which work it includes.
Can an ODM sell my product to my competitors?
It can unless the contract stops it. Wikipedia, a tertiary source, notes that under an ODM agreement the manufacturer usually keeps the intellectual property unless the customer buys it outright, so it can sell the same design to competitors. If exclusivity matters, ask in writing before the first order for an assignment of the design, or at least an exclusive licence.
What is a controlled label?
PLMA's US site describes store brands owned by wholesale buying groups and made available to the group's members as controlled labels. For the members they work like private label: the product carries the group's brand, not the manufacturer's. PLMA counts them among store brands, next to brands that carry the retailer's own name.
Is white label a legal term?
No. NordSourced found no EU act or standards-body definition of it. Wikipedia, a tertiary source, describes white label as a product whose specification the manufacturer sets and may sell to several clients, each under its own brand, while a private label product is made exclusively for one client who sets the specifications. Treat both as trade usage and describe what you want.
What is the difference between assigning and licensing a formula?
The EU IP Helpdesk describes an assignment as generally a permanent transfer of ownership, so the assignee becomes the new owner. A licence is usually comparable to a rental and does not imply a permanent transfer. A licence can be exclusive. For a formula, an assignment makes it yours; a licence lets you use it on the agreed terms.
Which manufacturers in the Baltics offer OEM production?
7 of the manufacturers NordSourced lists in Latvia, Lithuania and Estonia use the word OEM on their own website: AIRLAX, Eurobio Lab, ISM Furniture & Interiors, IVO, Lāma, Lami Super Booster and 1 more. Ask each what OEM includes for them, whether your specification or theirs, and who owns the result.
How many private label manufacturers in Northern Europe develop their own formulas?
56 of the 443 manufacturers listed on NordSourced name formulation and R&D among their services on their own website, 13% of the directory. They are gathered in manufacturers that develop the product for you. Ask each which development stages it charges for and who owns the finished formula.
How big is private label in Europe?
PLMA and NielsenIQ put private label at a 38.8% share of the grocery market across 17 European countries in 2025, with record sales of EUR 387 billion. PLMA's latest figure, the moving annual total to week 28 of 2026, is 39.5%. These figures measure retailers' own brands in grocery, the sense in which PLMA uses the term.
Do furniture manufacturers use the word OEM more than others?
In this directory, yes. 7 of the 13 manufacturers whose quoted sentences use OEM make furniture and interior products. Of the 249 cosmetics, food and supplement manufacturers listed, 163 name private label and 4 use the word OEM. Search for both words when you look for a manufacturer.
Which word should I use when I contact a manufacturer?
The words matter less than the description, because manufacturers use OEM, private label and white label in different ways. Say what you bring (a formula, a drawing, an idea or only a brand), what you want made, the quantity, and who should own the result. Then the quotation can be compared with others.
Where to go next
Sources
- Private label today, PLMA International Council (Private Label Manufacturers Association). Checked 13 Oct 2026.
- Store brands: facts, Private Label Manufacturers Association (PLMA), US. Checked 13 Oct 2026.
- A mosaic of markets: private label strengthens its position across Europe, PLMA International Council. Checked 13 Oct 2026.
- PLMA 2026's new look to help visitors take advantage of EUR 387bn sector (6 March 2026), Food and Drink Technology. Checked 13 Oct 2026.
- Private label (tertiary source), Wikipedia. Checked 13 Oct 2026.
- Original equipment manufacturer (tertiary source), Wikipedia. Checked 13 Oct 2026.
- Original design manufacturer (tertiary source), Wikipedia. Checked 13 Oct 2026.
- Your Guide to IP and Contracts (15 December 2020), European IP Helpdesk (EISMEA). Checked 13 Oct 2026.
Directory figures are counted from the manufacturers listed on NordSourced, each listed because its own website says it makes products for other brands; see how we check. This page is general information, not legal advice. Found a mistake? Tell us.