We’ve lived through the scenario multiple times. New technologies reach mainstream and existing business models go by the wayside. The old way of doing business is obsolete – or at least suboptimal – and large, seemingly unbreakable companies are vulnerable to smaller, more nimble startups.
Amazon.com serves as a shining example of how new technology (the internet and World Wide Web) opened up the door for a new business model (online bookselling). Online shopping left behind a wake of destruction for bookstores and many other retailers. The so-called “brick and mortar” stores didn’t all disappear, but most survived by jumping onto the technical bandwagon and reinventing themselves. And Amazon might disrupt others as they continue to reinvent and embrace new technologies that might threaten the likes of UPS – can you hear the sound of Amazon drones revving up their engines?
So what about 3D Printing?
What businesses will it enable some smart startup to “Amazon” in the near future? We could get crazy and suggest that it will “Amazon” Amazon, because nobody will need to have anything delivered. We’ll just fire up our printers, download a spec from the internet, and hit the magic “print” button. Maybe Amazon will play a highly diminished role by simply delivering feedstock and new printers? OK, not likely in the near future.
That example may seem far away, but 3D Printing will change things. As I mentioned in Can’t Beam Me the Part? OK, How About Just the 3D Printing Instructions?, 3D Printing has the potential to change more than the method of manufacturing. It can change the location and the timing. Ideally we just receive some manufacturing instructions and print what we need, when we need it. So who should worry?
Warehouses – Storing inventory is expensive. It ties up capital used for raw materials and labor, but also takes up space and creates risk of loss, damage, obsolescence, or just lack of demand. The “just in time” movement proved that lowering inventories drives value, but also that it drives up risk of shortages in unexpected circumstances. A painful learning lesson was the electronic component shortages that followed the Asian tsunami. 3D Printing could provide the benefits of manufacturing just in time – postponing production until moments before an item is needed –without as much risk because the printing would be decentralized and closer to the customer.
Distributors – Distributors consolidate goods so they can be delivered more efficiently. Sometimes they have warehouses as well, but the job is different. They consolidate products from different manufacturers so they can be purchased together. Again, the need diminishes for these companies as “brick and mortar” establishments and many already look a bit more like Amazon by consolidating and fulfilling orders virtually. But do we really need that when there are places like Amazon once inventory is take out of the equation? Maybe not.
Service Depots – Service depots and other “quick ship” facilities provide a valuable service. They make sure that critical items are available on short notice, potentially across a wide geographic area. Again, without the need for inventory there is no need for these. Service technicians can print what they need.
Postal Service – OK, here’s a different take. A report by the US Office of the Inspector General suggest that 3D Printing might boost USPS business. The point being that 3D printing will not happen at consumers, but close to consumers. This leads to a lot of “first mile” and “last mile” shipments that could leverage the US postal system. They even suggest some non-traditional solutions such as “the Postal Service could partner with 3D printing companies and even potentially bring some printing onsite at postal facilities.” Maybe the postal service isn’t ready to be “Amazonned” again, after all?
How real is this? Today, not very. 3D Printing is not as easy as hitting the mythical 3D Print button (see a well presented discussion on this from Al Dean, The Search for Push Button 3D Printing). It requires a lot of expertise not only on the design side, but on the manufacturing side. We’re just not there yet. And that’s not where most companies are focused. Gartner, for example, reports that the most common reasons companies invest in 3D printing are prototyping, product development, and innovation. They are focused on industrial scenarios, even if not in the core of their product at the moment. They are certainly not prioritizing consumer-oriented printing opportunities.
But consumer applications are getting a lot of buzz. I believe they are attractive and probably inevitable. Louis Columbus gathered a series of studies in his article 2015 Roundup of 3D Printing Market Forecast and Estimates. He shared a CSC report that indicates that 3D Printing for “new in-store experiences & innovative marketing” and “co-creation with customers” is a “likely development.”2 But when? And with what?
The first wave that we will see for average consumers (other than those born with the heart of a “maker”) will involve dedicated supply networks. There will be controlled relationships between the design, the material, and the printer. Retailers will likely partner with companies that will provide designs, materials, equipment, and the buying experience. The retailers will provide marketing, customer access, and a point of sales transaction in their stores. Think of the corollary of custom dog tags engraved or laser etched at the pet store. You buy their stock, provide some specs to their kiosk, and the rest is controlled by their machine. The retailer primarily provides space and visibility. There are far fewer variables to control in this scenario. This type of arrangement seems most likely to me.
But there may be other models that come to the front of the pack. Maybe brand new stores that offer 3D Printing fulfillment for a range of manufacturers? Or something even more disruptive will happen? Has anyone seen Amazon strapping 3D printers to drones? That would be disruptive! What do you see happening? Who do you see being “Amazonned?”
