With the world supply chain facing more challenges than ever do to the COVID crises, vulnerabilities may spur a new industry revolution. From centralized manufacturing, based off of the Chinese industry, to decentralized manufacturing that localizes the production of products. More importantly, additive manufacturing, which could ignite industrial 3d printing.
Western world politics led by United States rhetoric has been calling to restrict our dependence on Chinese manufacturing. But not much has really changed. Western businesses have been keeping with the status quo. Economic cost effectiveness is more important than government relationships. It was thought that making such drastic supply chain changes would be too much of a risk. But now, we might not have a choice.
Prior to the pandemic, US along with Europe have been showing signs of decoupling ties with China. This was brought by peacetime populist urges, intellectual property rights and human rights violations.
Today, the west accuses China’s lack of transparency which they claim prevented the preparation to handle such a pandemic. With tension at an all time high, and supply chains already shaken up with lengthy shipping times and delays, businesses are now facing a choice. From doing nothing to taking action to reroute their supply chains. Adjusting too late could have high consequences for businesses.
If these current trends continue, a new era of manufacturing will most likely take shape. What will this look like? May turn into a form of decentralized and additive manufacturing.
What is Decentralized Manufacturing?
Decentralized Manufacturing involves organizations having multiple locations for producing products. The facilities are distributed out a crossed a wider area. Unlike centralized manufacturing which distributes products long distances from one location, these facilities instead are strategically placed close to its customers.
What is Additive Manufacturing?
Additive Manufacturing (AM) or distributed manufacturing mainly done through 3d printing, allows for products to be made when sold. Centralized manufacturing processes have you produce large quantities, which you then store within inventory, and then ship to the customer. AM allows you to produce the part when the customer buys, skipping the high costs associated with storing inventory.
A Potential Combination of Decentralized & Additive Manufacturing
A study from the non-profit organization APQC found that companies who set up decentralized manufacturing have a 3% higher cost than centralized manufacturing. In order for prices to stay competitive, additive manufacturing could be the solution to lower the costs for a range of goods within western countries.
So with these two systems potentially merging, how will this look? The Trump administration has been talking about rolling a concept they call “Economic Prosperity Network” which would encompass countries, more specifically India & Vietnam to supply raw materials or parts that would then be assembled via a distributed facility network in the west.
The role for 3d printing could allow raw materials to be shipped to the west, where in country facilities will 3d print product requests coming from companies and minimizing the need to hold inventory. Think of a product being ordered and within 24 hours produced on the spot and sent to the customer close by. Overall minimizing costs normally accrued through a centralized manufacturing process.
Could this be our future? Only time will tell. But with the current state of affairs it would be prudent to ignore such a possibility.
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