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How 3D printing will drive the Supply Chain

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What is 3D printing in Supply Chain?

Supply chain is the sequence of steps involved in the production and distribution of a product, therefore it represents one of the main pillars in the functioning of a company. All the processes in the chain have to be controlled and integrated in order to have a successful business. In the last decades, markets have shown a significant switch from product to final consumer focus. For companies, being flexible on customization and agile on delivery has become a competitive advantage. In order to get these advantages, businesses have started using 3D printing to manufacture their parts and optimize their manufacturing processes. 3D printing is the manufacturing technology that is revolutionizing the way products are supplied to companies, thanks to its main advantages. Especially in a pandemic scenario, this disruptive technology has continuously shown to outperform.

The impact of 3D printing on the supply chain is estimated in quicker deliveries and lower inventory costs by bringing the production place closer to the final point of use.

Supply Chain 4.0: what are the challenges of the current supply chain?

Industry 4.0, known as the fourth industrial revolution, changed the way companies design their supply chain since it has contributed to the increase in performance in terms of money, time, and resources used.

In the context of Industry 4.0, Supply Chain 4.0 was born with the aim to improve performance and customer satisfaction mainly through the use of internet connection, new technologies, and advanced automation. Above all, the manufacturing industry must become smart in order to rapidly switch from mass production to customized production. Therefore the need for a quick response from production and logistics is given by a more flexible and efficient manufacturing process.

Global Supply chain challenges 2021

The current supply chain has shown its flaws in the last few years with the advent of an unpredicted event: the COVID-19 pandemic. This event has generated disruptions with a drop and subsequent rise in consumer demand with the economic recovery. Furthermore, many companies closed their doors due to infections or health regulations, thus resulting in a shortage of manpower and delivery delays which also led to product shortages and successive facility closures.

Since the very beginning, the pandemic has shown that, when China, one of the biggest raw material suppliers is impacted with supply chain disorders, there will be consequences on a global level. Countries are still paying for these disruptions since the pandemic has caused uncertainty at all levels of the supply chain. The manufacturing industry was hit especially hard by supply chain disruptions due to Covid as many port operations were hit and chip shortages continued. Pandemics aside, there is always the possibility of unpredictable events that can shift and disrupt the supply chain over time, for example, even geopolitical tensions can cause disruption.

Here are the main challenges of the supply chain:

Material and manpower scarcity: due to the sudden rise and decrease in consumer demand dependent on crisis or recoveries;
Difficult demand forecasting: due to the unpredictability of the future evolution caused by pandemics or geopolitical tensions;
Increasing transportation prices: consequent to lower manpower due to COVID infections or volatility in fuel prices;
Port congestion: consequence of the rise in consumer demand. Vessel and port congestion levels in 2021 have been unprecedented;
Changing consumer and industry demands: from standard to customized goods, consumers want their products manufactured better, faster and at a lower cost;
Maintaining inventory strategies: current strategies lack consideration of unexpected events and are not agile, inventories are important in case of a stop in production due to unavailability of raw materials;
Diversifying sourcing: important to reduce potential risks of lacking sourcing;
Unexpected time delays: can cause waterfall effects in the deliveries of products;
Keeping up with the latest government rules: in terms of travelling to/from a country.

Impact of 3D printing technology on supply chain

There are many ways 3D printing affects supply chains, from warehouse digitalization to local manufacturing, allowing many companies to implement this manufacturing technology to innovate their business intelligence, transportation, warehouse and achieve greater flexibility in the supply. 3D printing is changing the supply chain because it’s making it independent from consumer demand, allowing companies to manufacture parts without a minimum order batch.

The impact of 3D printing technology on supply chain goes beyond production and across all levels of the chain: logistics have to adapt to the faster production that satisfies shorter delivery times, catching new saving opportunities.

The benefits of 3D printing in supply chain are a much more flexible approach, as companies can produce small customized batches very fast and reduce the risks associated with market demands. Here’s why 3D printing will impact the global supply chain:

Short supply chain: A traditionally manufactured part has to be processed in different departments. For instance, it can be molded, cut, milled, welded and polished. Some of these steps need to be outsourced, like coating or finishing. One of the longest and most complex steps might be the assembly of different parts to form the finished product. This process usually blocks physical time spent on one product, therefore raising the overall costs. 3D printing impacts the global supply chain because companies can cut time and precious resources by delivering all-in-one parts, eliminating expensive assembly time and cutting chains in the process.
Reduction of Supply Chain Lead Times: eliminating entire steps in the supply chain leads to reduction in waste, delivery time and resource consumption, giving room for new resource allocation. Plus, companies can gain a higher control over their chain, being less dependent on the scheduling and delivering of their suppliers.
Local manufacturing: the physical production of large quantities of goods is often moved to where labor and raw materials are cheaper. In this scenario, delocalized production has higher costs in terms of transport and environmental impact and reduces the control of the entire supply chain. This situation can escalate as geopolitical tensions or global health emergencies arise and delivery times and costs become unpredictable. 3D printing, on the other hand, works with just one click, enabling local production, reducing transportation costs and emissions, and moving production from low-cost areas directly to the place of final use. The only remaining transport costs are those necessary for the raw material, the filament, if not available locally.
Cost reduction: 3D printing is estimated to be the most cost-effective technology for the production of small batches, limited series, or pre-series parts. The greater the complexity or customization, the lower the cost of additive manufacturing compared to traditional manufacturing. With higher production volumes, the economy of scale favors traditional technologies such as injection molding. However, 3D printing allows greater flexibility in production, reducing the number of inventory in the warehouse and the costs and risks associated with it.
Warehouse digitalization and inventory: According to an MIT study on the impact of 3D printing on the Global Supply Chain in 2020, the move to 3D printing allows companies to save 85% on transport costs, linked to the presence of finished products to be shipped from Asia. Inventory costs decrease by 17%, as less inventory is required, thanks to on-demand manufacturing enabled by 3D printing. In total, 70% of the savings were recorded across the entire supply chain.

Companies often pay premiums for stocking and storing products for a certain time, which is part of the warehouse management costs that include costs for orders, stock-out, and warehouse maintenance.

Avoid warehouse obsolescence: some articles might lose value if they stay in the warehouse over time. Shrinkage is the loss of products between the purchase time and the sale time caused by administrative errors, damage in transportation, or theft. It also accounts for obsolescence - the costs related to items unsold for a prolonged period that are then replaced by new versions. Therefore, there are direct benefits in reducing inventory, since the overall inventory costs are elevated. Digitalizing supply chains can lead to high benefits in terms of warehouse management cost reduction.
Agility and responsiveness: 3D printing is bringing flexibility in supply chains, allowing for a just in time and on demand production of parts. With 3D printing, companies can be resilient over unpredicted disruptions in the supply chain and act fast accordingly, reducing the connected risks.

With additive manufacturing companies can create digital inventories that contain the 3D files of their spare parts to be manufactured locally, when and where they are needed.

3D printing Supply Chain case study: how is Roboze technology helping to solve the supply chain issues?

The advantages of 3D printing in the supply chain are evident in terms of production flexibility and reactivity. The uniqueness of Roboze technology adds other benefits to those of the 3D printing technology itself, including:

Metal replacement: the use of high-performance polymers and composites, like PEEK, Carbon PEEK and Carbon PA allows for the production of finished functional parts that can substitute metals in extreme environments. The mechanical, thermal, and chemical properties of these materials guarantee rapid product development of highly complex geometries for the production of functional and customized prototypes as well as industrial end-use parts;
Repeatable and accurate production systems: the most precise and repeatable FFF printers in the world have been created by Roboze thanks to the patented Beltless System capable of achieving a positioning tolerance of 10 micrometers;
Supply chain on demand: Roboze 3D parts offers the production of parts on demand and just in time. Through the network of Roboze 3D Parts partners active in multiple continents, companies can find the supplier that is closer to the point of use and order their parts only when they need them and without having to invest in a machine purchase. The quality and repeatability of Roboze technology ensure the same quality in parts printed on machines located at two different sides of the world;
Human resources: due to the high automation of Roboze printers, there is no need to allocate a resource to track the production during the printing process. All that is needed is an initial check and final monitoring. Human resources are then free to be focused on other tasks;
Material waste: as opposed to traditional CNC machining, 3D printing technology is characterized by very low material waste, due to its additive nature. Roboze is enhancing waste reduction with a circular economy program that is able to collect the small waste present during manufacturing and recycle it for further use.

What are 3 industries that use 3D printing in Supply Chain?

The 3 industries that use 3D printing for the improvement of their supply chain are:

Energy: this industry is characterized by companies acting across multiple countries, from Qatar to Alaska, from Mozambique to Mexico. They need to produce spare parts in remote locations, like offshore platforms, that are difficult to reach and where a machine failure can costs millions. Having a digital warehouse enables them to maintain low inventory costs, reducing machine downtime.
Manufacturing: this industry has shortened the distance between the production point to the final point of use with the implementation of 3D printers on site. Custom jigs and fixtures are one of the product families that are the most commonly manufactured by this industry and help it to stay agile because they improve the process efficiency for the production of small batches, reducing the warehouse need.
Space sector: many parts for use in space are machined out of a block because of the low production volumes. In some cases, even 90% of the block is milled away to create the needed geometry, thus generating high material waste. Furthermore, supplying parts in orbit isn’t easy nowadays.

What's next: how will 3D printing impact the global supply chain?

In the future, 3D printing technology will partly substitute traditional manufacturing technologies because of its versatility. As the prices subside, due to an increase in raw material production and a consequent economy of scale, 3D printing will gain higher traction, making companies more resilient to sudden supply chain disruptions. As additive manufacturing is becoming more and more popular, companies are moving the first steps toward their adoption for supply chain improvements and are starting to design 3D printing models for the manufacturing of new products. Therefore, databases have been created which are full of CAD files always ready to be printed in case of need for replacement, enabling a 3D printing value chain. This will drastically change the aftermarket logic and allow for a faster replacement of spare parts.

There is a huge hype on advanced inventory optimization techniques. Digital warehousing is one that is enabled by 3D printing and helps companies handle unpredictability better than the standard inventories. Switching from traditional demand planning to expected demand shaping will improve dealing with supply chain challenges.

3D printing in Supply chain management

Every company can start the process towards the warehouse digitalization by implementing 3D printing within the supply chain management. Starting from the catalog of spare parts, a process of identification of the spare parts that can be substituted by 3D printing can be started. It is important to identify the slow and the very slow movers. These are the parts that tend to stay in the warehouse for a long time and become obsolete over time. A technical and economic feasibility must be run in order to evaluate the convenience of 3D printing these parts within the company supply chain.

The next step is the creation of a digital warehouse with the list of the parts that would benefit the most from 3D printing. If a digital CAD file is not available, reverse engineering and 3D scanning might help rebuild the part geometry. In the future, parts will be designed for additive manufacturing making sure to take full advantage of the technology.

With an organized and complete digital inventory, companies can request spare parts on demand and just in time at the printing center that is the closest to the final customer.