On-Demand Manufacturing: Why the Shift Is Inevitable

On-demand manufacturing produces goods only when they are ordered, rather than producing to forecast and holding the output in inventory. It trades the unit-cost advantage of large batches for speed, flexibility and the elimination of unsold stock, and 3D printing is what makes it practical at scale.

The shift has been building for years. Supply chain disruption accelerated it, customer expectations around customisation sustained it, and additive manufacturing removed the technical obstacle that had kept it theoretical.

Throughout this discussion, we will focus on the following:

1. Traditional manufacturing vs on-demand manufacturing
2. How does 3D printing boost on-demand manufacturing?
3. Who are some well-known players using on-demand manufacturing?
4. How can India benefit from on-demand manufacturing?

Traditional manufacturing vs on-demand manufacturing

The basic principle of traditional manufacturing is to produce a given number of units within a period of time. It also focuses on keeping an inventory for unexpected shortages. Traditional manufacturing typically works around the reduction of unit cost by producing larger quantities.

Traditional manufacturing involves:

1. Requirement generation
2. Production planning
3. Production at large scale
4. Storage and inventory management
5. Delivery

All manufacturing systems have a buyer, an engineer, and a supplier. A buyer purchases the end product. The engineer designs and manufactures it. The supplier procures the raw materials needed for production. In the traditional manufacturing process, there is a prolonged discussion on quoting the right price, with negotiations between the three parties to settle on something that works for all. This is time-consuming.

Perhaps the biggest time-consuming factor is production planning. Elaborate factory plans and assembly lines depend on the number of products to be produced. Even making molds and fixtures for processes like injection molding, robots for assembly, or item movement takes an enormous amount of time, which is one reason rapid prototyping changed the calculation so significantly.

Another persisting issue is inventory management. Predicting the number of units to be produced can be tricky, especially for products with a shorter shelf life, and sometimes the inventory goes unsold. In such cases, manufacturing companies have no choice but to either sell at a discount or write it off.

Then there is customer interaction. In the traditional setup the end-user is usually in the backseat: after the initial quoting of price and payment, the customer is out of the picture. That leaves a large gap between the manufacturer and the person who actually uses the product.

The on-demand manufacturing model aims at the opposite. Its primary purpose is to consider customer feedback and deliver products in the shortest span of time. Instead of spending a huge chunk of time predicting how many units to produce, it makes the experience user-centric, using digital platforms supported by cloud services to interact with the customer. That channel allows quotes to be generated in real time, keeps the customer connected throughout production, and maintains feedback during the process. This is the “just-in-time” strategy, common across many supply chains.

Large-scale production in the traditional system can be rigid and resistant to change. Most of the machinery is pre-configured to manufacture in high volume, and it requires more space for storage and inventory maintenance. The on-demand approach focuses on reducing lead time at every step of the production cycle, and its flexibility allows customisation that would take far longer traditionally. Modern technologies like 3D printing are simply better equipped for the on-demand approach than the traditional one.

How does 3D printing boost on-demand manufacturing?

Additive manufacturing techniques like 3D printing are adopting the on-demand process at a rapid pace. It is easy for 3D printing to fit into a digital platform and deliver products to customers quickly.

3D printing is itself a digital process. It requires a CAD model to be fed to the printer's processing unit, which converts the file into a three-dimensional object. With the growth of 3D printing, the overall cost of production has come down significantly. 3D printing and on-demand manufacturing are therefore complementary to each other.

“The situation is rapidly changing now, as on-demand manufacturing becomes ever more popular. 3D printing allows creating small series of products or parts quite cheaply.”
- Globalluxsoft

Several software tools aid the execution of this model. Predictive analysis is often used to give accurate estimates to the customer, reducing lead time at the order placement stage. Customers no longer have to fill out a form to get to a quotation. Digitalising the entire process from quote to manufacturing to delivery is what makes on-demand manufacturing viable.

Together, on-demand manufacturing and 3D printing produce a compact, customer-centric process with the following advantages:

1. Short turnaround time
2. Shortened lead time (3D printing is relatively faster)
3. Customer-centric approach
4. A more agile process, open to changes
5. Cost savings in both process and production
6. No inventory storage required
7. Online platforms make it accessible to a larger audience
8. The process is transparent
9. Quality control procedures are easy to implement

On-demand manufacturing has become more common across industries including aerospace and automotive. Let us look at some of the larger companies that have benefited from it.

Well-known players using on-demand manufacturing

Ford

Ford uses 3D printing to produce automobile parts. Typically it takes about five months of lead time to produce prototypes of any part in a traditional setup; using 3D printing, they can produce parts within a couple of days. They use the on-demand model, where customers place orders through an online forum, and Ford engineers can cater to customers more actively by enabling services digitally: spare parts production, repairs and so on.

“Consumers could also take advantage of this technology, downloading modifications or accessories to completely customize their vehicles.”
- Itssupplychain.com, on Ford's business model

Electrolux

Electrolux is a Swedish company that manufactures home appliances such as washing machines and vacuum cleaners. It runs its business model on on-demand manufacturing to provide customers with 3D printed spare parts, which reduces cost at four levels:

1. Manufacturing
2. Inventory
3. Maintenance
4. Product replacements

Caterpillar

Caterpillar is one of the best-known construction companies to have brought 3D printing into day-to-day operations. They successfully print parts in aluminum and titanium, and have printed an excavator from scratch. Their business model extends that expertise to customers through on-demand manufacturing, and they are now looking to digitalise existing traditional processes for producing gas turbines, fuel mixers and similar components.

Aerospace and defence

The fourth industrial revolution (Industry 4.0) uses digital manufacturing to enable a smart ecosystem across different industries. The aerospace and defence industries are seizing the opportunity to transform themselves through multiple channels, and advanced processes like 3D printing are gaining traction because they can rapidly deliver on-demand, low-volume production.

Aircraft and rocket parts need not be mass-produced; they are often designed to specification. Through digital additive manufacturing techniques, it is easy to customise and produce complex structures. CAD software allows engineers to work with innovative geometries and designs. Aerospace components are expensive, so inventory management challenges are minimised through on-demand services, and warehousing costs come down with them.

Lockheed Martin is a pioneer in aerospace and defence. It uses the latest additive manufacturing techniques and drives on-demand manufacturing in daily operations, working with NASA and other defence companies to manufacture aircraft components, space vehicle equipment and rocket parts.

“You have forgings which can traditionally take over a year to procure now able to be produced in an additive manner, with significantly less material waste, over a period of two weeks.”
- Brian Kaplun, Senior Manager, Lockheed Martin

The entire manufacturing industry is transforming in both technique and process. On-demand manufacturing is also accountable for advances in software technology: progress in cloud services and virtual machines enables processes to transform digitally and rapidly. Many large companies are speeding up production and delivery to give a hassle-free experience.

How can India benefit from on-demand manufacturing?

Indian manufacturers have had strong reasons to move away from traditional methodologies: supply chain volatility, rising expectations around customisation, and the cost of holding inventory against uncertain demand. On-demand manufacturing pushes companies to automate their processes at different stages.

Tata Steel, for example, works keenly on digitisation by adopting agile and efficient processes that enable on-demand manufacturing.

“Tata Steel in Kalinganagar, Odisha is one among 44 global elite facilities on the World Economic Forum's Lighthouse Network of companies that have successfully combined digitization with the manufacturing process.”
- industr.com

A newer entrant is Truventor (formerly Chizel), which runs a B2B online cloud service bringing suppliers and manufacturers onto a single platform through the on-demand model.

“Digital manufacturing is the next leap for India's tech leadership, the first being the software outsourcing movement in the 1990s.”

India has a large market in which to unleash modern technologies and processes that accelerate manufacturing growth. The aim is to build a system that can adapt to sudden shifts in demand, and on-demand manufacturing aided by 3D printing makes manufacturing more robust. Many 3D printing companies, Fabheads among them, were able to deliver face shields to frontline workers because of exactly that agility.

Conclusion

On-demand manufacturing transforms the traditional process to deliver customised products to customers in a short time. Digital platforms based on cloud technology facilitate it effectively, and modern additive manufacturing techniques act as a catalyst to improve the overall customer experience. This article examined its potential by looking into:

1. The comparison between traditional and on-demand manufacturing
2. On-demand manufacturing with additive manufacturing
3. Companies that use the on-demand model
4. The future of on-demand manufacturing in India

All in all, the new approach tries to improve lead time and customer experience through a digitised supply chain. For parts where weight and strength matter as much as speed, that digital approach extends into composite manufacturing too; our continuous fiber printing produces structural parts to order across mobility, marine and robotics without the tooling lead time that traditionally made low volumes uneconomic.

Need parts made to order rather than to forecast? Talk to our team.

Frequently asked questions

What is on-demand manufacturing?
On-demand manufacturing produces goods only when they are ordered, rather than producing to forecast and holding output in inventory. It prioritises speed, flexibility and customisation over the unit-cost advantage of large production runs.

How is on-demand manufacturing different from traditional manufacturing?
Traditional manufacturing produces large quantities to reduce unit cost, then stores them until sold. On-demand manufacturing produces to order, which removes inventory risk, shortens lead time and allows customisation, but gives up the economies of scale that come with large batches.

How does 3D printing enable on-demand manufacturing?
3D printing needs no tooling, moulds or fixtures, so there is no setup cost to amortise across a production run. That makes a batch of one economically viable, which is the technical obstacle that previously kept on-demand manufacturing theoretical.

Which companies use on-demand manufacturing?
Ford uses it for automotive parts and spares, Electrolux for 3D printed appliance spare parts, Caterpillar for construction equipment components, and Lockheed Martin for aerospace and defence parts. In India, Tata Steel and Truventor are among those adopting the model.