Why logistics companies can lead the charge into the fourth modality of transportation and additive manufacturing.
The manufacturing and logistics model is a well-oiled machine. Traditionally, manufacturers make and store products while logistics companies deliver them using one of the three modalities of transportation: air, water and ground.
However, leading logistics providers like UPS and cutting-edge tech companies like Fast Radius are tapping into a fourth modality, using the internet and emerging digital technologies to revolutionize the movement of goods around the world.
Instead of storing products on shelves, designs and production specs will be stored in the cloud. The information is accessible to globally networked and strategically located microfactories that will use additive technologies to manufacture physical products shipped to local customers. In other words, the web becomes the warehouse.
UPS, for example, is integrating Fast Radius on-demand manufacturing into the company’s global logistics network to create new opportunities for its customers, as well as new revenue streams.
“We are moving from linear supply chains to agile networks that can quickly respond to consumer demands.”
The goal of UPS On-Demand Manufacturing powered by Fast Radius is to create the world’s first globally connected, elastic manufacturing cloud using additive manufacturing to fabricate industrial parts on demand at the scale, quality, consistency and cost required for real parts.
This partnership comes as both cloud computing and 3D printing are changing production and shipping in real time. Just follow the money: Cloud computing is a $130 billion market (up from $8 billion a decade ago) while 3D printing could become a $100 billion industry by 2025.
The case for change
In case inevitability isn’t compelling enough, here are three other reasons to embrace this fourth modality of transportation:
We are moving from linear supply chains that store excess inventory to agile networks that can quickly respond to consumer demands at the click of a button.
Manufacturers work with logistics companies that have a network of global storage sites. Upgrade these sites to accommodate in-house additive manufacturing, and suddenly you own (and profit from) two critical legs of the supply chain.
In 2014, UPS invested in Fast Radius, a provider of on-demand additive manufacturing, locating its Additive Micro Factory in UPS’s Louisville, Kentucky Supply Chain Campus, just minutes from the UPS global air hub, WorldPort. Strategically locating near WorldPort allows manufacturing until midnight for delivery to most U.S. locations by the next morning.
With microfactories, you can iteratively design products – sometimes after they’re released – while enabling on-demand production. If a manufacturing company has access to microfactories, they will own the means of production and distribution, which can also decrease their import and export costs.
Financial opportunities trump the risks.
Changing your business model always requires a certain amount of risk. But those tracking current industry trends know the future belongs to the agile.
Customers now expect their goods delivered on demand, making local manufacturing and distribution centers crucial. These expectations are about to skyrocket, as emerging markets’ share of global demand is expected to reach 66 percent by 2025. Those willing to invest in additive manufacturing will open new revenue streams and become market leaders.
You can make the impossible possible.
Additive manufacturing not only enables innovations in design but product ordering because you can envision, design and manufacture items on demand.
On-demand manufacturing eliminates the need for minimum order quantities and instead allows manufacturers to instantly quote products, manage projects and track inventory – anywhere at any time.
The automotive, appliance and aviation industries have all embraced additive manufacturing because it facilitates iterative design, on-demand manufacturing and mass customization.
In the fiscal year 2017, the number of design patents increased again, signaling six straight years of growth. Logistics companies that pair this growth with new technologies can lead the next wave of the industrial revolution and bring new inventions to life.
The fast track
The fourth modality of transportation is on the fast track, especially for logistics companies that are ready to seize it.
Understanding where the manufacturing and logistics industries are going, ensuring your company will seize the opportunity, acknowledging the financial advantages and accomplishing the impossible are a tall order – but the fourth modality of transportation can deliver.
If you recognize the need for change, consider looking at your operations to see if additive manufacturing and on-demand supply chains will deliver value to your bottom line.
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