CSCMP's Supply Chain Quarterly
December 18, 2017
Supply Chain Executive Insight E-Newsletter
Each week the Supply Chain Executive Insight e-newsletter will include brief articles about developments that are often overlooked by other supply chain publications. We will present you with summaries of the latest research as well as new ideas on how to make your supply chain operations more effective. And we'll offer commentary that sheds light on what's happening in supply chains today.
Sign up now!

Most Read Articles

News from our sister publication
DC Velocity
Perspective
Perspective

What additive manufacturing could mean for supply chains

Comment
Years from now, individualized production could change transportation and logistics patterns.

One of the visions for future supply chains outlined in a recently released Deutsche Post DHL study, Delivering Tomorrow: Logistics 2050, pictures a world of customized lifestyles. In this scenario (one of five in the report), three-dimensional printers manufacture one-of-a-kind products for individual consumers.

In a world where 3-D printers handle much of the production (an approach called "additive," "rapid," or "direct digital" manufacturing), companies that make customized goods would be more likely to move raw materials than finished products. The report predicts that the implications for logistics would include a greatly reduced need for long-distance transportation of finished and semi-finished goods. Since additive manufacturing would revive local production, it also would necessitate stronger regional logistics capabilities and high-quality, last-mile networks. (For more about this production method, see "How rapid manufacturing could transform supply chains" in the Quarter 4/2008 issue of CSCMP's Supply Chain Quarterly.)

I agree with the report's authors that additive manufacturing will bring about more customized production, but this technique won't be appropriate for everything. It might be cost-effective for items like decorative housewares; a homeowner could, for example, order something that fits a particular color scheme. But certain types of low-value products, like garden hoses, would continue to be made in huge quantities in countries where labor costs are cheap. Hence, the need for long-distance transportation would decline but would not go away.

I do think the report understates the potential impact of this type of manufacturing on retailing. The rise of additive manufacturing would only serve to expand the growth of online retailing, turning shopping malls into ghost towns. A consumer in this world would either order a custom-made product over the Internet or pay a visit to a local producer—perhaps someone in the neighborhood who has a 3-D printer. In either case, the volume of truckload movements of finished goods to retail outlets would surely fall.

Admittedly, additive manufacturing is in its early stages. Still, supply chain managers should keep an eye on this important manufacturing trend. Low-cost country sourcing in a global economy has resulted in complex international supply chains. But if in decades to come the economy is dominated by 3-D "printed" manufacturing, then we can expect to see regional supply chains expand at the expense of global ones.

James A. Cooke is a supply chain software analyst. He was previously the editor of CSCMP's Supply Chain Quarterly and a staff writer for DC Velocity.

Join the Discussion

After you comment, click Post. If you're not already logged in, you will be asked to log in or register.


Want more articles like this? Sign up for a free subscription to Supply Chain Executive Insight, a monthly e-newsletter that provides insights and commentary on supply chain trends and developments. Click here to subscribe.

We Want to Hear From You! We invite you to share your thoughts and opinions about this article by sending an e-mail to ?Subject=Letter to the Editor: Quarter 2012: What additive manufacturing could mean for supply chains"> . We will publish selected readers' comments in future issues of CSCMP's Supply Chain Quarterly. Correspondence may be edited for clarity or for length.

Want more articles like this? Subscribe to CSCMP's Supply Chain Quarterly.