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How will 3D printing affect the supply chain?

And why is UPS investing in it?


INDIANAPOLIS, Ind. – They may seem like odd bedfellows: UPS, a global logistics and delivery company and Fast Radius, a company pushing 3D printing, which stands to greatly reduce the number of shipments required by allowing businesses to manufacture products locally on their own.

But through its UPS Ventures arm, the company has taken a minority stake in Fast Radius, in hopes of better understanding how 3D printing – or additive manufacturing – will affect its business long-term.

“We use (the fund) to invest in knowledge capital,” explained Alan Amling, vice-president of UPS Ventures. “Looking at new business models. How do we work with companies in the start-up community to help educate us on what the next wave of solutions will be so we can get a head start?”

Amling admitted that additive manufacturing, which allows people or companies to produce their own stuff using a 3D printer, “was completely overhyped” in the beginning.

“Everyone was going to have a printer in their house and what was being printed was low-quality and high-cost,” Amling said during the FTR Transportation Conference. “There has been a metamorphosis around that industry, and if you are thinking of how it was five years ago, you have the wrong perception of what it is now.”

While UPS isn’t a manufacturer, it was curious about how additive manufacturing could affect the supply chain and its delivery business.

“If goods are actually manufactured closer to the point of consumption more frequently and in lower volumes, what does that mean to a company like UPS? What does that mean to your company?” Amling asked.

It certainly could affect storage and transportation, which is what UPS does. Amling sees it first being embraced by the aerospace, automotive, and health care industries. Today, additive manufacturing is about a US$10-12 billion business, and is expected to soon grow to US$100 billion. But global manufacturing today represents $12 trillion, so it’s still a drop in the bucket.

“While this is going to be growing at a rapid pace, it’s not going to be overtaking traditional manufacturing,” Amling said. However, he also acknowledged it will have an impact. “E-commerce is only 10% of total retail, but even though it’s only 10% it’s disrupting supply chains, disrupting retail. So, you don’t have to be 50% of an industry to disrupt it. Five to 10%, and things are going to change.”

He envisions a day when parts are stored within a virtual inventory in the cloud.

“These parts will never be in a warehouse,” he said. “When they’re needed, they’ll be printed on demand and shipped to the customer.”

This will also allow manufacturers to create product for a market of one. Adidas, for instance, is already building a shoe that will have sole matrixes with up to 20,000 connections, designed to reflect a customer’s specific body weight, gait, and intended purpose.

“At some point, my kids are going to be looking at me saying, ‘You used to buy shoes off the rack that didn’t fit you perfectly?’” said Amling. “Right now, it seems so futuristic, but no more futuristic than some of the technologies that rolled out 10 years ago.”

Truck parts, such as gaskets, will also be printed. Fleets will be able to have them manufactured locally on demand.

The types of parts that will be additive manufactured will increase in time, as polymers advance.

“We are finding polymers that have properties to replace some metal parts,” Amling said. “We have polymers that are almost a rubber-like substance. What you can do with polymers is increasing.”

But he said it will be some time before metal parts can be 3D-printed. As a result, additive manufacturing will have a bigger impact on some supply chains than others.

“It’s going to be impacting some pockets more than others,” said Amling, noting transport companies should expect smaller, more frequent shipments from some sectors. But opportunities will also be created. Shipments of bulk resins and bulk aluminum will be required, and some parts will still have to be manufactured traditionally.

“It’s a very different supply chain if now, instead of big manufacturers there are thousands of small manufacturers. How does that change the supply chain? We’re trying to figure that out, but additive manufacturing allows that to happen,” he said.

Asked what business owners should do to prepare, Amling urged getting some hands-on experience with the technology.

“Get a 3D printer and get your people familiar with it,” he urged. “Start experimenting. Start looking at what parts make sense. The biggest change you have to make right now is not moving production to 3D printing, it’s understanding how the rules are changing and how things that weren’t possible before are possible now.”

Alan Amling (right) and Eric Starks.


James Menzies

James Menzies

James Menzies is editor of Truck News magazine. He has been covering the Canadian trucking industry for more than 15 years and holds a CDL. Reach him at james@newcom.ca or follow him on Twitter at @JamesMenzies.
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