Inspired by a documentary on the BBC of a girl which has got a new prosthetic hand made by a 3D printer, I wondered what the impact of this new technology would be on logistics.
What is 3D printing?
Well, first of all it is important to understand what 3D printing is in generall. Currently around 28% of the money spent on printing things is for final products, according to Terry Wohlers, who runs a research firm specializing in the field. He predicts that this will rise to just over 50% by 2016 and to more than 80% by 2020.
3D printing, as well called additive manufacturing, is a procedure in which a printer reads a digital blueprint (mostly CAD data) and methodically will put togehter material according to instructions, creating a final product that’s built up layer by layer. Those printers are capable of producing extremely detailed levels of design that can be difficult to create with other methods.
3D Printing was originally developed as an automated method of producing prototypes. Although there are several competing technologies, most work on the basis of building up layers of material (sometimes plastic, ceramics or even metal powders) using a computer aided design.
The logic for using 3D Printing for prototypes is understandable. Traditional, so called ‘reductive’ manufacturing (where materials are removed), techniques can take longer and are much more expensive. Parts, shoes, fashion items and accessories and other consumer goods, can all be printed for review by the developers. Whereas mass production is viable due to economies of scale, it is uneconomical for ‘one offs’ and prototypes. 3D Printing is removing this differential, where every item produced is an original (or perfect copy) and producing for one is as cheap as producing for many.
The way in which each product is individually manufactured means that it is ideal for ‘mass customization’ techniques. Consumers will be able to have a much greater impact in the final format of the product which they are buying, and have it manufactured to their precise specifications.
The effect on the Supply Chain
Because of the ability of printing or producing on demand there will be no need of finished products stacked on shelves or stacked in warehouses anymore. Whenever there is a need for a part or a product a company can just produce it. This effect will bring the supply chain down to a point where the most important part is the adding of new efficiencies to the system.
The traditional supply chain model is founded on traditional constraints of the industry, the efficiencies of mass production, the need for low-cost, high-volume assembly workers, real estate to house each stage of the process and so on. 3-D printing finds its value in the printing of low volume, customer-specific items, items that are capable of much greater complexity than is possible through traditional means. This eliminates the need for both high volume production facilities and low level assembly workers, thereby cutting out at least half of the supply chain in a single blow.
There are several sources online where you can find a list of improvements or changes in the logistics of the future. I summed up four of them which, in my mind, are the most important:
- Potentially a proportion of goods which were previously produced in China or other Asia markets could be ‘near-sourced’ to North America and Europe. This would reduce shipping and air cargo volumes.
- A major new sector of the logistics industry would appear dealing with the storage and movement of the raw materials which ‘feed’ the 3D Printers. As 3D Printers become more affordable to the general public, the home delivery market of these materials would increase.
- The changing supply chain dynamics will lead to the evolution of a new type of logistics company resembling a ‘4PL’, or service management company (Former ‘3PL’). Their businesses will comprise a mix of software development, delivery services, partner relationship management, contract management and brainpower.
- The raw materials today are digital files and the machines that make them are wired and connected, faster and more efficient than ever. And that demands a new model—a need to go local, globally.