Learn in the textbookLeveraging External Resources and Inter-Company Collaboration
DefinitionFabless (ファブレス) describes a company that owns no factories, focuses on planning and designing products, and leaves production to other companies.
ExplanationThe company avoids heavy investment in building factories and updating equipment, and it can easily change its production partners or volumes as demand shifts. The model is common in semiconductors and electronics.
AnalogyIt is like a food brand with no kitchen of its own that designs and sells its menu while contracted kitchens do the cooking.
Memory hookFab (fabrication plant) + less: no factory.