DFM is the manufacturer’s opinion on the manufacturability of products. What are the loopholes and complexities of the design? How to simplify them? Is the design even manufacturable? Or can it be designed to get it done in an optimized cost? A properly-executed DFM looks like an amalgamation of all the stakeholders including designers, engineers, contract manufacturers, and material suppliers. DFM ensures that the design is optimized and does not have unnecessary cost embedded in it.
Therefore, DFM is knowing the best design to fit your electronics in terms of both cost and complexity. DFM is an abbreviation for design for manufacturability.