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Calculating the value of 3D printing
A Blueprint for 3D Printing
Turning insight into action
Quantifying the cost of 3D printing requires a calculator, quantifying the value it brings requires a new mindset
For every business investment, you need a business case. How do you make a compelling business case for 3D printing? Too often, we see business cases that are simply an addition of cost savings across a few manually identified parts. While this type of business case can justify a machine purchase, it will never justify a business transformation. Understanding costs is a matter of evaluating a simple formula of fixed and variable costs. In manufacturing, fixed costs include tooling, sourcing, and setup and are amortized across volumes. Variable costs include labor and materials. Any analyst can add up these figures to compare costs, but that is far from a fully developed business case for additive. Focusing solely on piece-part cost reduction means you’ll miss 90% of the iceberg. Once you’ve determined the cost, to correctly calculate the value of using 3D printing requires a different mindset. In this book, you’ve seen stories of leading companies leveraging the multiplicative effects of changes to products and processes and the exponential effects of new business opportunities enabled by 3D printing. Many of these examples go beyond part-for-part cost reduction and instead identify value as both tangible and intangible, near term and long term benefits.
How do you calculate the cost? Material cost: Material usage for the part, support material, and other material waste Machine depreciation: Portion of the machine price attributed to a part due to the time the machine is being used to build the part Consumable costs: The cost of consumables used for the build (build trays, argon gas, filters, printhead, etc.) Labor costs: Personnel cost involved in the build (build file preparation, machine preparation, build monitoring, machine clean-up, and support removal) Risk: Risk of failure involved in building a part. Usually comes in two different types, time risk – the longer the print, the higher the risk of failure, and geometry risk – certain geometries might have higher risk of printing failure
Machine MachinePrice PartBuildTime x Depreciation = Cost DepreciationYears (326 x 24 x MachineUtilization)
