How switching to additive manufacturing delivers huge cost reductions

Companies that are dependent on physical components travelling smoothly and reliably through complex global supply…...
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Companies that are dependent on physical components travelling smoothly and reliably through complex global supply chains can achieve major cost reductions and significantly reduce their carbon footprints by adopting ‘additive manufacturing’ (AM), an expert in the field has claimed.

Writing in Supply Chain Management Review, AM expert Lee-Bath Nelson summarises the distinction between traditional supply chains and new ‘virtual’ supply chains deftly. In the former, parts must be stored physically in inventory post-manufacture, after having passed quality assurance.

Storage costs for large quantities of physical inventory are far from insignificant.

However, with virtual inventory, items are stored in digital form – in bytes – until they are ordered.

As soon as an order arrives, the digitally stored data relating to it can be instantly retrieved and the part immediately ‘additively manufactured’ – or 3D-printed, in common parlance – wherever it’s required.

Delivering it to its final destination is likely to require far shorter journey times and distances as the AM centre that ‘prints’ it can be relatively local, slashing shipping and logistics costs as well as overcoming a host of other obstacles, such as tariffs, trade issues, border control bottlenecks and a range of other potential supply chain quicksand zones. 

As Nelson notes, by avoiding the need for storing physical inventory, companies immediately benefit from huge cost reductions.

Issues such as tail spend management and sourcing savings are perennials in procurement work, but the cost reductions associated with AM are truly major.

Because production of these items can be localised, the carbon footprint associated with long-distance logistics is massively reduced.

AM centres are already “cropping up everywhere”, Nelson says, boosting local economies by creating new jobs and putting money into the pockets of local people to spend on local products.

Nelson writes: “The key enabler to all this goodness is secure and consistent additive manufacturing. With it, you can go ahead and turn your inventory into bytes and say goodbye to the hassles of moving stuff – and the associated cost of doing so.”

Source: https://www.scmr.com/article/byte_your_inventory_and_beat_the_system

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