3D Printing Trends – 3D Printing Causes New Business Models and Disruptive Competition

Here are 3 more important Trends caused by 3D Printing

1. Shifting sources of profit

Additive-manufacturing technologies could alter the way companies add value to their products and services. The outsourcing of conventional manufacturing helped spur companies such as Nike to rely more on their design skills. Likewise, 3-D printing techniques could reduce the cost and complexity of other kinds of production and force companies to differentiate their products in other ways. These could include everything from making products more easily reparable (and thus longer lived) to creating personalized designs.

Indeed, reducing the reliance on hard tooling (which facilitates the manufacture of thousands of identical items) creates an opportunity to offer customized or bespoke designs at lower cost—and to a far broader range of customers. The additive manufacture of individualized orthodontic braces is just one example of the potential of these technologies. As more such offerings become technically viable, companies will have to determine which are sufficiently appealing and commercially worthwhile. The combination of mass customization and new design possibilities will up the ante for many companies and could prove very disruptive to traditional players in some segments.

In certain parts of the value chain, the application of additive manufacturing will be less visible to customers, although its impact may be just as profound. A key challenge in traditional aftermarket supply chains, for example, is managing appropriate inventories of spare parts, particularly for older, legacy products. The ability to manufacture replacement parts on demand using 3-D printers could transform the economics of aftermarket service and the structure of industries. Relatively small facilities with on-site additive manufacturing capabilities could replace large regional warehouses. The supply of service parts might even be outsourced: small fabricators (or fabs) located, for example, at airports, hospitals, or major manufacturing venues could make these parts for much of the equipment used on site, with data supplied directly by the manufacturers.

Of course, retailers too could someday use fabs—for example, to let customers tailor products such as toys or building materials to suit their needs. That business model could represent a value-chain play for manufacturers if, for instance, they owned the machines, core designs, or both.

2. New capabilities

Design is inherently linked to methods of fabrication. Architects can’t design houses without considering construction techniques, and engineers can’t design machines without considering the benefits and limitations of casting, forging, milling, turning, and welding. While there is a wealth of knowledge around design for manufacturing, much less is available on design for printing. Our conversations with executives at manufacturing companies suggest that many are aware of this gap and scrambling to catalog their design know-how.

Getting the most out of additive-manufacturing techniques also involves technical challenges, which include setting environmental parameters to prevent shape distortion, optimizing the speed of printing, and adjusting the properties of novel materials. Indeed, tuning materials is quite a challenge. While plastics are relatively straightforward to work with, metals are more difficult. Slurries and gels (for example, living tissue or the material for printed zinc–air batteries) are extremely difficult.

The most successful players will understand these challenges. Some are already creating centers of excellence and hiring engineers with strong experience in additive manufacturing.

3. Disruptive competitors

Many benefits of 3-D printing could cut the cost of market entry for new players: for example, the use of the technology to lower tooling costs makes it cheaper to begin manufacturing, even at low volumes, or to serve niche segments. The direct manufacturing of end products greatly simplifies and reduces the work of a designer who would only have to take products from the computer screen to commercial viability. New businesses are already popping up to offer highly customized or collaboratively designed products. Others act as platforms for the manufacture and distribution of products designed and sold online by their customers. These businesses are gaining insights into consumer tastes and building relationships that established companies could struggle to match.

Initially, these new competitors will be niche players, operating where consumers are willing to pay a premium for a bespoke design, complex geometry, or rapid delivery. Over the longer term, however, they could transform industries in unexpected ways, moving the source of competitive advantage away from the ability to manufacture in high volumes at low cost and toward other areas of the value chain, such as design or even the ownership of customer networks. Moreover, the availability of open-source designs for 3-D printed firearms shows how such technologies have the potential to create ethical and 3D Printing regulatory dilemmas and to disrupt industries.

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Posted in Industry Statistics

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