3D Printing: The Beginning of the End for Long-Haul Logistics?
3D printing has been around in one form or another for decades, but only now is it developing into a major disruptive trend. A growing number of manufacturers are adopting the technology, with potentially far-reaching consequences not only for their production processes but also for the global supply chain. This month, we look at the threat 3D printing poses to logistics players – and the steps they can take to safeguard their business going forward.
Increased Adoption Fuels Stellar Growth
3D printing – or additive manufacturing, as it’s also known – has been deployed in prototype building for quite some time. But as the technology becomes ever faster, more affordable, and more robust, there has recently been a sharp rise in its adoption by manufacturers and private individuals alike.
Today, additive manufacturing is used to create everything from medical devices to aviation components, as well as products designed and printed by home users. In light of these developments, observers predict that the global 3D printing market will be worth some USD 550 billion by 2025.
Made-to-Measure Products – Virtually Zero Waste
The appeal of 3D printing is clear: Its flexibility supports the product customization that today’s consumers crave. Small wonder, then, that German automaker BMW leverages the tech not only to produce its series parts, but also to create personalized components based on customers’ own designs.
What’s more, the technology delivers greatly enhanced resource efficiency. Unlike traditional production procedures, 3D printers build the end product by adding successive layers of materials, hence the name additive manufacturing. As a result, it is no longer necessary to remove excess material through sanding and milling so that only the material actually needed is consumed.
Decentralized Production – A Major Threat to Logistics Providers
But 3D printing goes far beyond this and has potential to radically reshape traditional supply chains. For decades, manufacturing has been centralized, with finished products being shipped from central production facilities to their final destination – a journey that often spans the globe. And it is this need to transport products over long distances that has been at the heart of international logistics providers’ business models.
By driving a paradigm shift in from centralized to decentralized production, 3D printing put these models at risk. Using additive approaches, manufacturers can now print products locally, massively reducing the need for long-distance transportation. And there are already signs of a move in this direction. Thyssenkrupp, for example, is setting up a 3D printing hub in Singapore, allowing innovative products to be created closer to customers in the Asia-Pacific region – with no need for intercontinental shipping.
On-Demand Production: Fewer Shipments, Fewer Parts in Storage
What’s more, 3D printing enables vital replacement parts to be manufactured on demand, rather than in large-scale production runs, greatly reducing costly inventory volumes. While that’s great news for manufacturers, it poses yet another challenge for logistics providers, who have traditionally transported these parts from manufacturing plants to storage facilities.
While moving production closer to consumers may not spell the end of long-haul transportation entirely, it is almost certain to significantly reduce the number of global shipments. And this will pose a major risk for international shipping providers going forward.
Mastering the Challenges of the New Supply Chain Paradigm
So how can logistics companies counter the threat to their existence from this decline in their core services? One way of adapting to the shift from centralized to decentralized production is for global logistics specialists to acquire their own 3D-printing expertise and play an active role in additive manufacturing.
These logistics providers typically have a network of large-scale storage facilities, which they could upgrade to include 3D printers. This, coupled with the required skillsets, would enable them to offer manufacturers local printing services – relocating production from the traditional factory floor to the warehouse. Manufacturers would simply have to provide the CAD files containing the necessary printing specifications (digital product), with the logistics provider taking care of the rest.
Leading Companies Players Show the Way
One global player already taking steps in this direction is DB Schenker, which is developing business models designed to incorporate 3D printing into its warehouse and supply chain offerings – particularly in the field of spare parts production.
Another big name that is very active here is DHL, whose vision is to create a network of 3D printers at its warehouses and distribution centers around the globe. The aim: to process, produce, and deliver spare parts to customers on demand.
From Long-Haul to Last Mile
Of course, even if 3D printing does massively disrupt supply chains and delivery scenarios, there will still be a need for transportation. However, this will be more about last-mile deliveries to customers than about traditional long-haul shipments. Here, too, global logistics players will need to examine ways of providing competitive offerings and avoid being outmaneuvered by smaller, more established providers in this space.
When it comes to logistics, the risks posed by 3D printing may be great, but there are also a host of attractive new business opportunities. If logistics companies are to avoid becoming victims of tomorrow’s 3D revolution, they should start looking seriously at these opportunities today.