A new approach
3D printing – also known as additive manufacturing – has come to the forefront of public consciousness in recent months. There have been numerous stories of small businesses, schools, and even individuals using their 3D printers to manufacture face masks and other personal protective equipment (PPE) in order to alleviate the global shortage of these products for front-line workers during the pandemic.
Using additive manufacturing to transform supply chain operations
However, as some manufacturers are discovering, the flexibility offered by 3D printing technology also has the potential to transform supply chain operations, particularly in areas such as aftermarket maintenance and repair. For example, Deutsche Bahn, the German railway leader, deployed 3D printing to produce a number of spare parts when its spare parts supply chain was completely disrupted by lockdowns in hard hit areas like Spain and Italy.
Traditionally, manufacturers of everything from industrial equipment and agricultural machinery to home appliances have supported the after-sales maintenance and repair of their products by storing replacement parts in their factories or in centralized warehouses; from here the parts are shipped by established carriers to repair shops. Alternatively, some manufacturers rely on intermediaries to hold stock of spare parts and ship them to wherever they are needed.
The problem with this traditional supply operation is that it typically creates high inventory and labor costs and potentially increases waste. The manufacturer or the intermediary has to store large volumes of parts for all models and versions of the product – just in case replacements are needed by customers. A large proportion of these parts may end up being scrapped after they have been sitting in the warehouse beyond the active life of the products themselves. And the manufacturer also incurs potentially high long-distance shipping rates and charges for middlemen to manage the inventory and shipping of their parts from centralized warehouses.
Produce spare parts on demand and provide enviable customer delivery experience
The beauty of additive manufacturing is that it enables companies to build a replacement part the moment a customer demands it. By printing spare parts only when and where they are needed, it’s possible to significantly reduce inventory and production costs. Instead of operating a centralized distribution center for replacement parts – or depending on third parties to manage their parts inventory and shipping with associated costs – manufacturers can create smaller regional 3D production facilities from where they can quickly and cost-effectively produce and ship parts.
In effect, 3D printing allows manufacturers to move closer to their customers, enabling them to meet their demands faster and more effectively, improving the overall purchase experience. Ideally, companies would want to combine 3D printing with sophisticated parcel management technologies and processes to create the most effective aftermarket operation which optimizes costs while offering an enviable customer delivery experience.
Parcel management systems can help either the manufacturer or their appointed partner to automatically determine the most efficient shipping option for each parcel, considering delivery deadlines, destinations, size and weight of product, carrier rates, performance and other factors.
In other words, by marrying 3D printing with sophisticated parcel management technology it’s possible to connect to – and move closer to – any customer, anywhere, through any carrier or combination of carriers.
Building resilience in the spare parts supply chain
And of course, as we have seen, the flexibility that 3D printing technology offers has the added advantage that it can build resilience into spare parts supply chains, which is something most manufacturers are exploring during the pandemic. If you can print off parts easily on demand close to where they are needed, the supply is less vulnerable to supply chain disruptions such as a closure of warehouses in virus-hit locations or travel delays.
As far back as 2016, Gartner predicted that 3D printing would gain traction in the manufacturing industry. Now we are seeing increasing evidence that when properly integrated, forward-thinking manufacturers can reap the rewards of 3D printing, especially if applied to their aftermarket parts business where it can support fast, localized production of spare parts.
Looking ahead, we can expect to see more manufacturers re-evaluating the ways they service their customers, taking advantage of the combination of 3D printing and sophisticated parcel shipping to reduce their dependency on intermediaries, ensure the right parts are used for repairs, and maintain closer, more interactive direct relationships with their customers and partners.
Ken Fleming is president of Logistyx Technologies, the leader in Transportation Management for parcel shipping, providing an unmatched global multi-carrier network, predictive analytics and full visibility into customer deliveries. Its software boosts parcel shipping efficiencies and other business KPIs for many of the world’s top manufacturers, retailers and logistics providers. Logistyx’s flagship software, TME, is the world’s first single engine specifically designed for parcel shipping. With more than 8500 carrier service integrations globally, TME provides carrier compliance, predictive analytics and tracking on shipping from start to finish.