Reevaluating the manufacturing supply chain beyond costs
Wednesday, July 08, 2020
It’s no secret every industry has been impacted by the COVID-19 pandemic, including the manufacturing. While manufacturing has felt the effects in multiple ways, the pandemic has severely impacted supply chains, revealing some true vulnerabilities.
Due to closed borders, ongoing trade wars, imposed regulations, and other changes impacting production, OEMs and manufacturers have shifted their supply chain operations onshore — giving them the flexibility to change production as needed and take advantage of just-in-time (JIT) manufacturing.
Reshoring manufacturing processes, specifically additive manufacturing processes, have allowed manufacturers to reduce lead times by accelerating access to both supplies and inventory.
However, manufacturers are still considering the cost-effectiveness of onshoring manufacturing processes. Traditionally, offshoring manufacturing processes means cutting costs, but not necessarily for all. Manufacturing processes, such as making parts, can still be obtained at competitive prices thanks to novel technologies like 3D printing. Here’s how:
Reduced Overhead Costs
One of the biggest benefits of relying on domestic 3D printers for manufacturing is their ability to reduce overhead costs, primarily in the form of lower inventory. For companies that have seen a drop in their revenue, the value of reducing overhead cannot be overstated.
Because 3D printing companies can be cost-effective even for short runs, companies can take advantage of just-in-time manufacturing. With the help of JIT manufacturing, production times are markedly reduced, as are the response times from suppliers to customers. This means that there is also less inventory to store, further cutting overhead costs.
Cost-Effective Shipping & Logistics
Domestic production of parts and components produced through additive manufacturing offer additional savings in terms of lower shipping and logistics costs. When parts are made closer to home, this makes products less susceptible to trade wars and tariffs as well. In addition to saving money, this makes costs much more stable and predictable.
3D printing itself is a highly cost-effective process. The price of 3D printing is competitive with prices that manufacturers might find overseas for the same job once shipping and warehousing is factored in. This makes 3D printing a cost competitive option that is much more reliable.
Faster Production Times
One of the biggest benefits of 3D printing is that it speeds production times. Manufacturers are able to use 3D printing to produce large volumes of a single product in a matter of days once a successful prototype is produced.
Furthermore, there is no tooling required with 3D printing. By not having to spend money on tooling which can cost tens or even hundreds of thousands of dollars, companies are never locked into a single design.
This means that companies are able to be more responsive to the feedback of customers, providing them with more flexibility than ever before. In contrast, it could take months to fine-tune tooling needs using traditional manufacturing processes.
With 3D printing, the start-up process is much shorter and the product can adjust to market feedback. This helps to expedite production times, reducing the amount of time it takes to fulfill a single order. With this capability, it is easy to launch new products at nearly any time, helping companies maintain a competitive edge.
A New Approach to the Global Supply Chain
The pandemic has impacted every industry. As companies look to onshore their manufacturing and supply chain processes, it is important for businesses to look at their operations in a new way. 3D printing provides manufacturers with the speed and flexibility to respond to rapidly shifting economic conditions while keeping overhead costs low.
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