Impact of 3d printing in supply chain and logistics arenas, by Cerasis
Supplied by Cerasis bloggers
First of all what is 3D printing and what is the outlook of the application in manufacturing?
As we noted in our top issues in American Manufacturing series, 3D printing is a key trend and applications manufacturers are paying attention to over the next decade. Currently around 28 percent of the money spent on printing things is for final products, according to Terry Wohlers, who runs a research firm specializing in the field. He predicts that this will rise to just over 50 percent by 2016 and to more than 80% by 2020.
The process of 3D printing, sometimes called additive manufacturing, is a slow procedure in which a printer reads a digital blueprint and methodically drops building material according to a set of instructions, creating a final product that’s built up tiny layer by tiny layer. The printers are capable of producing extremely detailed and intricate levels of design that can be difficult or impractical to create with other methods.
Some are saying that 3D Printing will be “the next industrial revolution” said Doug Angus-Lee, rapid prototype account manager with Javelin Technologies, an Oakville, Ont.-based supplier of the technology.
“The invention or the implementation of the assembly line changed the way manufacturing works and 3D printing is going to change the way manufacturing works in the future. When the web took off, it gave us the tool for everybody … to become a publisher that was something that only a few of the biggest companies in the world were able to do it before that. Well, with 3D printing, we’re all able to be manufacturers.”
The list of materials that can be ingested and outputted by 3D printers is growing, some might say into sci-fi territory. The capabilities of 3-D printing hardware are evolving rapidly, too. They can build larger components and achieve greater precision and finer resolution at higher speeds and lower costs. Together, these advances have brought the technology to a tipping point—it appears ready to emerge from its niche status and become a viable alternative to conventional manufacturing processes in an increasing number of applications.
Should this happen, the technology would transform manufacturing flexibility—for example, by allowing companies to slash development time, eliminate tooling costs, and simplify production runs—while making it possible to create complex shapes and structures that weren’t feasible before. Moreover, additive manufacturing would help companies improve the productivity of materials by eliminating the waste that accrues in traditional (subtractive) manufacturing and would thus spur the formation of a beneficial circular economy (for more, see “Remaking the industrial economy”). The economic implications of 3-D printing are significant: McKinsey Global Institute research suggests that it could have an impact of up to $550 billion a year by 2025.
The promise of a 3-D printing-based supply chain is simple: "Additive manufacturing will democratise the manufacturing process." So says Ed Morris, director of NAMII, the federally-funded initiative set to define and promote the future of the industry.
3D printing.....It WILL affect the supply chain
"In terms of impact on inventory and logistics," he says, "you can print on demand. Meaning you don't have to have the finished product stacked on shelves or stacked in warehouses anymore. "Whenever you need a product," he explains, "You just make it. And that collapses the supply chain down to its simplest parts, adding new efficiencies to the system."
Those efficiencies run the entire supply chain, from the cost of distribution to assembly and carry, all the way to the component itself, all the while reducing scrap, maximizing customization and improving assembly cycle times.
Basically, Morris says, it tears the global supply chain apart and re-assembles it as a new, local system.
The traditional supply chain model is, of course, founded on traditional constraints of the industry, the efficiencies of mass production, the need for low-cost, high-volume assembly workers, real estate to house each stage of the process and so on.
But additive manufacturing bypasses those constraints.
3-D printing finds its value in the printing of low volume, customer-specific items, items that are capable of much greater complexity than is possible through traditional means. This includes hollow structures like GE's fuel nozzles that would normally be manufactured in pieces for later assembly.
This at once eliminates the need for both high volume production facilities and low level assembly workers, thereby cutting out at least half of the supply chain in a single blow.
From there, the efficiencies of that traditional model stop making sense, it is no longer financially efficient to send products zipping across the globe to get to the customer when manufacturing can take place almost anywhere at the same cost.
The raw materials today are digital files and the machines that make them are wired and connected, faster and more efficient than ever. And that demands a new model—a need to go local, globally.
Driver shortages: Why the industry needs to be worried
While driver shortages are a global problem, with a recent survey from the International Road Transport Union suggesting that driver shortages are expected to increase by 25% year-on-year across its 23 member countries, the issue has very much made itself felt for UK businesses in recent weeks.
A perfect storm of factors, which many within the industry have been wary of, and warning about, for months, have led to a situation wherein businesses are suddenly facing significant difficulties around transporting goods to shelves on time, as well as inflated operating costs for doing so.
What’s more, the public may also see price rises as a result due to demand outmatching supply for certain product lines, which in turn brings with it the risk of customer dissatisfaction and a hit to brand and stakeholder reputation. Given that this price inflation has been speculated to hit in October, when the extended grace period on Brexit customs checks comes to an end, the worst may be yet to come.
"Steps must be taken to make a career in the industry a more attractive proposition for younger drivers, which will require a joint effort from government, industry bodies, and the sector as a whole"
That said, we have already been hearing reports of service interruption due to lack of driver availability, meaning that volumes aren’t being transported, or delivered, to required schedules and lead times. A real-world example of this occurred on the weekend of 4-6 June with convenience retailer Nisa, with deliveries to Nisa outlets across the UK affected by driver shortages to its logistics provider DHL.
But where has this skills shortage stemmed from?
Supply is the primary issue. Specifically, the number of available EU drivers has decreased by up to 15,000 drivers due to Brexit alone, and this has been further exacerbated by drivers returning to their home country during the COVID-19 pandemic, as well as changes to foreign exchange rates making UK a less desirable place to live and work. This, alongside the recent need to manage IR35 tax changes, has also led to significant inflation in driver and transport costs.
COVID-19 complications have also meant that there have been no HGV driver tests over the past year, meaning the expected 6,000-7,000 new drivers over the past year have not appeared. With the return of the hospitality sector we understand that this is a significant challenge with, for instance, order delivery lead times being extended.
It is little surprise, therefore, that the Road Haulage Association (RHA) earlier this month became the latest in a long line of industry spokespeople to write to the government about the driver shortage for trucks. The letter echoed the view held by much of the industry, that the cause of this issue is both multi-faceted and, at least in some aspects, long-standing.
So, many in the industry are in agreement as to the driving factors behind this crisis. But what can be done?
Simply enough, outside of businesses completely reorganising their supply chain network, external support is needed. In the short-term, the government should consider providing the industry with financial aid, and this can also be supported more widely with legislative change.
Specifically, immigration policy could be updated to place drivers on the shortage occupations list, which would go some way towards easing the burden created by foreign drivers returning to their home countries. Looking elsewhere, government should also look for ways to increase the availability of HGV driver tests after the blockage created by the coronavirus lockdowns.
Looking more long-term, steps must be taken to make a career in the industry a more attractive proposition for younger drivers, which will require a joint effort from government, industry bodies, and the sector as a whole. As it stands, multiple sources suggest that the average age of truck drivers in the UK is 48, with only one in every hundred drivers under the age of 25. We must therefore do more to increase the talent pipeline coming into the industry if we are to offset more significant skills shortages further down the line.
On the back of a turbulent year for the supply chain industry, it has become increasingly clear that the long-foretold shortage of drivers is now having a tangible and, in places, crippling effect on supply chains.
Drivers, and the wider supply chain industry, have rightly been recognised for the seismic role they played in keeping the nation moving and fed over the past year under unprecedented strain. If this level of service is to continue, we must now see Government answer calls to provide the support the sector needs, and work hand-in-hand with the industry to find a solution. If we do not see concrete action to this effect soon, we are likely to be in for a turbulent few months.
Rob Wright is executive director at SCALA, a leading provider of management services for the supply chain and logistics sector