3D Printing Will Add Strategic Flexibility to the Supply Chain – but When?

Part 5 of our 5-part series on Technologies Disrupting the Supply Chain

3D Printing Will Disrupt the World’s Supply Chains

For years, 3D printing seemed like a far-off concept.

It’d be years before it had any impact on manufacturing beyond its potential use for prototypes.

Or it felt like a (sometimes silly) gimmick.

3D printer manufacturers would feature rock bands in their booths at large trade shows like CES playing instruments—guitars, drums, the whole nine yards—produced entirely with 3D printing.

How Will 3D Printing Affect the Supply Chain

But today, we’re seeing real-life examples of innovative companies using 3D printing in ways that are sure to be disruptive to supply chain management.

Late last year, Daimler Trucks North America announced a project to produce plastic replacement parts using 3D-printing technology.

Large commercial vehicles run for hundreds of thousands of miles, and the plastic pieces on the interior of the cab undergo years of wear and tear.

Replacing them is often difficult though, particularly for older trucks. If there is safety stock of the pieces at all—which is rarely the case—they are likely deep on a back shelf in a warehouse nowhere near where the truck is.

If there are no parts, they need to be produce, which requires ordering raw materials, changing out tools, and shipping the parts to where the truck is being serviced. If this is a “truck down” situation, that can mean a loss of revenue that can last weeks.

But on-demand printing of those parts means those trucks can be operational and on the road within a matter of days.

It also saves warehouse space. For now, Daimler is only producing a few, select parts this way. They will monitor performance to determine which parts to add in the future.

On-Demand Supply Chain Being Planned by Amazon

Perhaps not surprisingly, Amazon is looking to enter the 3D printing space as well.

Their need to stock millions of items in order to ship them in a matter of days—if not hours—requires they maintain huge warehouses at strategic locations around the country.

And that’s why they filed a patent for a mobile 3D printing apparatus. It would work something like this:

1. Customer orders a product
2. Amazon determines 3D printer for that product closest to that customer
3. Instructions (and materials, if necessary) are sent to closest printer
4. Product is printed
5. Product is delivered to customer or one of Amazon’s secure pods near the customer

Again, this idea wouldn’t work for everything Amazon currently stocks in its warehouses, but for the several hundred items that could be 3D printed, a mobile printing unit could save the company millions of dollars in warehouse, transportation, and shipping costs.

The Economics of 3D Printing

With traditional manufacturing, materials are usually sourced and shipped from multiple suppliers to centralized facilities (usually factories) for processing and assembly.

The finished goods are then packaged, processed and shipped to distribution centers or waiting customers via a supply chain.

A study by Airbus showed that by redesigning its brackets for 3D printing, the company could achieve a 40% reduction in CO2 emissions over the lifecycle of the bracket and reduce the weight of the airplane by 10 kg.

In contrast, 3D printing can greatly reduce complexity in manufacturing and holds a number of additional advantages over conventional production techniques, including:

• Lower number of production steps to design, prototype, and manufacture highly complex and/or customized products.
• Faster delivery time through on-demand and decentralized production strategies.
• Lower logistics and product costs, such as reduced shipping and storage costs, elimination of import/export costs through local production, and elimination of new production tools and molds.
• Higher sustainability and efficiency in production through using the least amount of material and energy during production.

How Does 3D Printing Work?

The operation of a 3d printer is quite similar to an inkjet printer, but instead of applying to paper, 3D printers inject materials in successive patterns to ‘build up’ a three-dimensional solid object.

Three basic ingredients are needed in order to 3D print an object:

1. A digital model. The digital design that is used as a blueprint by the printer. They can be created from scratch using a CAD program or by using a scanner to render a 3 dimensional model of the object to be printed.
2. Feed material. The material used to build the physical object. It is estimated that 52% of companies required a metal feed material before they will seriously consider 3D printing to replace at least part of their production process, while 31% require polymer-type material. Other materials being experimented with are concreate, ceramics, and even food.
3. A 3D printer. The hardware needed to create the solid object from the digital model and the feed material.

Key Success Factors for Widespread Adoption of 3D Printing

Thus far, most industries have chosen to ignore the benefits of 3D printing. A notable exception to this trend is the medical industry, where the create of 3D-printed prosthetics and implants (hearing aids and dental crowns for e.g.) is now becoming increasingly common.

According to Ernst & Young’s Global 3D Printing Report 2016, 11% of companies are testing and experimenting with 3D printing, while just 3% claim significant experience with 3D printing and have a clear strategic plan at the highest management level for its future application.

Some reasons why adoption has been slow include lack of technological maturity for most industrial-grade applications, high costs for printers and materials, and limited knowledge about 3D printing technology.

Therefore, the widespread adoption of 3D printing will depend on the realization of five key success factors:

1. Material technology. For 3D printing to be truly effective, a number of material technology issues needs to be resolved – chief among these is the ability to print objects using multiple materials.
2. Process speed and quality. Today, a typical consumer-grade 3D printer needs 4-5 hours to print an object a golf ball, and approximately 9 hours to print a more complex object of roughly the same size. This delivery time will need to be reduced substantially in order for this method of delivery to become acceptable to mainstream enterprises or consumers.
3. Warranty and liability issues. Questions regarding who owns the liability when a 3D printed part breaks. Depending on the situation, the responsibility could lie with the user, the manufacturer of the 3D printer, the designer of the digital model, or the company that used the 3D printer to product the object. Presently there is no regulatory framework in place to protect consumers.
4. Intellectual property challenges. Ownership and protection of design files will take on an extremely important role when the economy switches to 3D printing, or the manufacturing sector could see the same kinds of issues as those faced by media companies and the pirating of digital music and movie files.
5. Printer, material, and scan costs. In order for 3D printing to be adopted en masse by manufacturers, the costs of production must be substantially lower in order to encourage the capital investment that will be necessary to replace the traditional supply chain solution with this approach.

Conclusion

Encouraged by opportunities for greater customization, less waste, and more localized manufacturing and delivery, companies across many industries are showing more interest in 3D printing for manufacturing and as a source of new business models.

However, there remain many obstacles to achieving these objectives and today, at best, 3D printing remains a complementary process and not a substitutive one.

There is strong evidence that 3D printing will greatly impact manufacturing process in the future, but exactly when that happens, is anybody’s guess.

Read The Entire 5-Part Series on Disruptive Supply Chain Technologies to Watch in 2018

Article #1: Blockchain is Becoming a Crucial Link in the Supply Chain

Article #2: Automation and Digitization Will Shorten the Supply Chain

Article#3: Shipper-3PL Relationships Will Share Information at a Strategic Level

Article #4: Logistics is Experiencing a Talent Revolution

Article #5: 3D Printing will Add Strategic Flexibility to the Supply Chain – but When?