Thinking of Setting Up an OEM in India? Start with EOR Instead
June 11th, 2025
There’s a quiet shift happening in global manufacturing.
India is no longer just the “next big thing”—it’s now. It’s where global OEMs are looking to build smarter supply chains, source competitively, and tap into deep engineering talent. But for every opportunity India offers, it also presents a familiar challenge: complexity.
Most manufacturers, when entering India, take the hard road:
Incorporate a legal entity. Navigate state-wise labor laws. Set up payroll, tax structures, compliance audits.
It’s a long process—and a risky one if you’re not 100% sure yet.
But there’s a better way to begin.
Start lean. Start legally.
Start with an Employer of Record (EOR).
Why Manufacturers Are Rethinking “Start from Scratch”
Let’s say you’re a European OEM looking to assess Indian suppliers, run trial production, or build a small R&D support team. You’re excited. You’ve read the reports.
But the minute you call your legal department, the tone shifts.
- Incorporation can take 4–6 months.
- You’ll need a director based in India.
- State compliance varies and is updated regularly.
- Minimum capital requirements.
- Local audits. Vendor registration. Social security compliance.
- And a whole host of things you hadn’t planned for in your timeline.
What started as a smart strategic move now feels… heavy.
That’s where EOR flips the script.
So, What Is EOR—and Why Should OEMs Care?
An Employer of Record is a local partner that legally hires employees on your behalf. You don’t have to set up a company, navigate red tape, or hire local legal teams.
You focus on the work. The EOR handles the paperwork.
Through EOR, you can hire:
- Engineers to test-run your product development
- Procurement experts to explore local sourcing
- Quality inspectors for supplier audits
- Field service techs for after-sales or installation
- Logistics and compliance talent to ease imports and operations
And you do all this without forming a legal entity in India.
Why EOR is a Game-Changer for OEMs
It’s faster.
You don’t have to wait six months to enter the market. With EOR, you can be operational in a few weeks. You start doing instead of just planning.
It’s safer.
No long-term commitments. No deep upfront investment. You get the flexibility to try, learn, and change course if needed.
It’s scalable.
Start with two hires. Grow to twenty. Or pause and pivot if your supply chain priorities shift. You remain agile.
It’s strategic.
You get to experience India before you fully commit to it. That’s not hesitation. That’s smart business.
A Real-World Analogy
Think of EOR as renting a fully-furnished workspace before building your own factory.
You bring your people, plug in your laptops, and get to work—without first pouring concrete.
Then, once the model works and the market proves its worth? You buy the land and build.
Conclusion
India is ready. Its manufacturing ecosystem is maturing fast, and global OEMs who make the first intelligent moves will win big.
But first moves don’t have to be heavy, bureaucratic, or expensive.
They can be light. Fast. Strategic.
Start by hiring the right people.
Validate your assumptions.
Learn the landscape.
Then scale with confidence.
FAQs
To further assist your audience, here are some commonly asked questions that will help clear up any confusion:
Yes. OEMs commonly use EOR to hire roles in quality control, sourcing, compliance, and R&D. EOR is perfect for technical, field, or even office-based roles.
Yes. That’s the point. The EOR is the official employer on paper, but you guide the team’s day-to-day performance.
Most EORs will help you transition your employees smoothly onto your own payroll once your entity is ready. No need to rehire or renegotiate terms.
Not at all. You manage your team. You assign the work. You drive performance. The EOR handles legal employment and compliance in the background.
In most cases, you can be up and running within 2–4 weeks—hiring your first employees and getting boots on the ground while your long-term strategy evolves.
