How to Think about Additive Manufacturing ROI

by Ryan Martin | 2Q 2019 | IN-5494
The way we measure manufacturing productivity is about to change. Part of this is due to macroeconomic drivers like tariffs and trade wars; the other part is due to technology innovation. We started to touch on this in the ABI Research Executive Foresight “Additive Manufacturing, Spare Part Perpetuity, and the Rise of the Microfactory,” where we pointed out that the advent of production Additive Manufacturing (AM) shifts cost management control from activities that are transactional (moving a part from A to B; turning a part to be cut or milled; coordinating with machine shops and components suppliers) to those that are continuous (raw materials, feedstock, energy consumption/conservation). Since then, companies like Desktop Metal, Carbon, Formlabs, and even digital service bureaus like Fictive, 3D Hubs, and soon Origin have started to rouse the market. For Desktop Metal, it’s the company’s metal binder jetting Production System; for Carbon, it’s subscription-based pricing; for Formlabs, it’s the launch of two new 3D printers, the Form 3 and Form 3L. Meanwhile, Fictive raised a US$33 million Series C funding round, 3D Hubs raised a US$18 million Series C funding round, and Origin, although yet to officially lift the veil, has some compelling things in the pipe as the second (to Carbon) subscription-based platform provider. All of these developments warrant a finer point for AM Return on Investment (ROI)—and that finer point is what we refer to as total lifetime value.

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