ELECTRONIC CONTRACT MANUFACTURING AND DESIGN SERVICES MARKET SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024-2031)

Electronic Contract Manufacturing and Design Services Market Size and Trends

Global electronic contract manufacturing and design services market is estimated to be valued at USD 712.03 Bn in 2024 and is expected to reach USD 1,462.75 Bn by 2031, exhibiting a compound annual growth rate (CAGR) of 10.8% from 2024 to 2031.

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Contract manufacturers help technology companies to focus on developing products while these can manufacture large volumes of devices and components. This division of labor allows both parties to maximize their core competencies.

Increasing demand for electronic devices in various industries

With technology penetrating deeper into every aspect of lives and industries, there has been huge demand for electronic devices globally. Be it consumer electronics like smartphones, tablets, wearables or industrial and medical devices, electronics have become an indispensable part of modern life. On the consumer front, upgrading to the latest smartphone or smart home devices has almost become a psychological necessity for people. As disposable incomes rise and millions enter the aspiring middle class globally, there has been huge demand for such devices.

The proliferation of internet of things (IoT) can offer untapped opportunities across industries. Manufacturing processes are evolving to become more automated, optimized and data-driven with millions of sensors powering the next wave of industry 4.0. Critical infrastructure and transportation are leveraging electronics for improved operations as well as safety. Even sectors like oil & gas, mining and construction are embracing smart solutions. The healthcare industry has undergone a revolution of sorts with focus shifting to preventive and remote care enabled by devices ranging from wearables to medical imaging systems. With aging populations worldwide, there has been huge demand for assisted living technologies and telehealth.

While industries continue broadening the scope of applications of electronics year after year to drive operational efficiencies, costs are also under pressure to be controlled. Outsourcing manufacturing as well as product design services is emerging as the most viable strategy. This propel the global electronic contract manufacturing and design services market by providing customers an asset-light approach to developing and manufacturing cutting-edge electronic solutions on demand. With specialization being the focal point, electronic manufacturing services (EMS) providers are well-placed to address this burgeoning demand across industry verticals through economies of scale.

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Rising trend of outsourcing manufacturing and design services

The business landscape prioritizes flexibility and nimbleness over maintaining expanded in-house capabilities. Growing complexities in electronics combined with shorter product life cycles have made it increasingly difficult for many organizations to develop comprehensive expertise across the value chain on their own. At the same time, cost optimization remains a top priority. This leads to rise to outsourcing as a favored strategy for both manufacturing and design requirements.

Design services outsourcing allows enterprises to leverage the technical skills of specialized design houses during the concept and development stages. Such providers help streamline the process with value engineering while also proposing innovative ideas. These take complete responsibility for design verification and compliance with quality and regulatory standards. This enables OEMs to stay laser-focused on their core competencies. On similar lines, electronic manufacturing services providers are emerging as single-point partners to produce finished goods as well as perform various processes like assembly, testing, and fulfillment.

The expertise, infrastructure and process maturity of EMS companies have convinced many small businesses and big brands alike about the commercial as well as operational advantages of outsourcing. These guarantee on-time delivery while absorbing demand fluctuations with relative ease. The increased risk-taking ability, costs savings through economies of scale and speed to market aided by global supply chains are hard to achieve in-house. Outsourcing drives workflow optimization through continuous improvement initiatives by service providers. These factors drives the rising trend of outsourcing manufacturing and design engagements worldwide. Established EMS providers are expanding their technical skills and delivery footprint to capture a larger share of this outsourcing wave.