OEM Would Become an Important Model for Feed Production

By CnAgri2017-03-23 13:32:29 Print

In recent years, some feed companies have launched OEM service for farming companies. Namely, according to the requirements on formula, material quality and processing techniques from farming companies, feed companies produce customized feed and charge the fees of processing. It is predicted that this model would be increasingly popularized among feed companies. The main reasons are as the followings:

For scaled farming companies, if they produce feed by themselves, they will have the disadvantages of material purchase costs, quality control, formula, equipment automatic level, production costs, etc., compared to specialized feed companies; besides, extra labor and energy are needed. If they purchase feed from the market, there possibly will be the problems of single formula, weakly-targeted varieties, no better way to grasp quality of materials, etc., so the requirements from farming companies can’t be met.

For feed companies, along with a drop in number and an increase in scale of terminal customers, and more fierce competitiveness, the companies are gradually decreasing their operating rate and have a great deal of idle capacity, which objectively ask feed companies to change existing production-selling models and provide feed production service more suitable to scaled farming companies. OEM is the best way to meet the change in demand.