Electronic Manufacturing Services Market Size

Electronic Manufacturing Services Market Size

Electronic Manufacturing Services Market was valued at USD 580.2 billion in 2023, growing at a CAGR of over 5% between 2024 and 2032. The demand for outsourced manufacturing services is being driven by the increasing use of smartphones and other smart devices, which is a major growth driver for the industry.

The demand for smartphones and other smart gadgets is rising as customers depend more and more on them for productivity, entertainment, and communication. The demand for personal connectivity is not the only factor driving this spike; advanced features like high-resolution displays, potent processors, and sophisticated sensors are all factors. Original equipment manufacturers (OEMs) in the smartphone and smart device industries are looking to EMS providers for effective and affordable manufacturing solutions to meet the ever-increasing demand and quickly changing technological requirements.
 

EMS businesses contribute significantly to the creation of smart gadgets and smartphones by providing design, engineering, manufacturing, and supply chain management skills. OEMs can take advantage of economies of scale, access cutting-edge facilities, and their specific talents by outsourcing manufacturing to EMS providers. As EMS providers take care of the intricate details of production, OEMs are free to concentrate on their primary skills, which include product creation, marketing, and sales. Moreover, EMS suppliers are excellent at meeting the demands of the smartphone and smart device industry, which are dynamic and require quick time-to-market and flexible production quantities.
 

For instance, according to the GSMA Mobile Economy report, the number of 5G devices reached 17% in 2023 and will rise to over 54%, i.e., approximately 5.3 billion connections by 2030. This will increase the adoption of 5G-based consumer electronics devices, such as smartphones, tablets, laptops, and wearables, augmenting market growth.

Electronic Manufacturing Services (EMS) firms may find it beneficial to concentrate on high volume services at first, but there are important drawbacks in the same sector. Having too much reliance on a small number of important customers or contracts for large-scale production is one significant obstacle. EMS companies that rely too much on a small number of clients may find themselves at risk from supply chain disruptions, shifts in client preferences, and variations in demand. Furthermore, price pressure is a common result of the fierce competition in the EMS industry, especially in high-volume contracts, which over time can reduce profit margins. Furthermore, giving high-volume services priority could take focus and funds away from diversification initiatives, which would limit the company's potential to profit from developing markets, specialized services, or niche markets.