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Save. Make. Connect.

And Canada’s leading trade and industry association is here for you

Helping you save money, make money and connect to business opportunities is CME’s business mantra and it’s why we have developed BUY, Canada’s newest buyer-seller guide.

In our second annual edition, you will read listings from many of Canada’s manufacturers and exporters as well as the top suppliers to the $700-billion industry.

Using CME’s exclusive network, we want to connect you to potential new suppliers and/or customers to help improve your bottom line.

But the question remains, why do it old-school, in a printed or hard copy when the trend is for more and more digital publications where you can go online and find a supplier with the click of a mouse?

Call us old-fashioned, but we like to buck the current high-tech trends complete with bits and bytes. So we went retro, back to something tangible, physically appealing, that you can hold in your hands and touch.

However, you may be reading this digitally, using our iOS or Android app — we can’t ignore the tech trends altogether.

For us, it’s about meeting our readers’ demands; giving you the choice to consume your information the way you want. For us, it’s never an issue of either/or.

And this BUY Guide is about giving you an important choice — to seek out new partners.

Today, partnerships are critical to any business success as it’s crucial to expand your networks.

The days of cold calling and e-mail phishing are long gone. You need to be innovative and creative to expand your network; you need to work through your partners’ partners… And then some.

Add that principle to Save. Make. Connect. and you have the foundation of CME’s Industry Benefits Program (IBP) where we bring Canada’s best service providers under one umbrella to provide manufacturers and exporters both value-add and cost-saving services and products to make you profitable.

From discounts on forklifts to group benefit and health insurance plans, we have more than 25 service providers that offer a potential total savings of $60,000 per year.

If you want to learn more about our IBP program, please visit www.industrybenefits.ca and start saving.

Enjoy this issue of BUY and come grow with us as we make plans to make the 2016 issue bigger and better.

Buy 2016 call out

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Next Issue: September–October 2015

Business and financial services

Close deadline: July 31, 2015
Material due: August 7, 2015

To advertise, contact: Ronda Landygo — ronda.landygo@cme-mec.ca or call 1-877-880-3392

Special feature: Manufacturing Month preview

Features:

  • Currency risk abroad

  • Insurance and liability

Deliver your message to Canada's leading decision makers

The September–October issue of 20/20 is a manufacturing and exporting guide to navigating the complexity of issues in the current economic climate for Canadian manufacturers and exporters.

Have an opinion or a story to tell? Join us and add to the debate.

That's why it's critical you participate in this insightful and undoubtedly, provocative issue.

The publication date for this issue is early September.

Canadian Manufacturers & Exporters' magazine — 20/20 is the only publication that Canada's manufacturing and exporting leaders rely on for intelligence and solutions to the issues they face day to day. We are not afraid to ask the tough questions nor provide the answers you don't necessarily want to hear — we deliver the intelligence you need.

Distributed via Canadian Manufacturers & Exporters (CME) to 16,000 manufacturers across the country in hard copy along with 17,000 digital copies. Readership of 20/20 magazine is 82,500 per issue.

Our value proposition is simple — we can make a difference in your business. Becoming a CME advertiser gives you access to the biggest business network in the nation and more importantly, helps you translate your message into language understood by manufacturers and exporters across Canada.

And it works. More than 98 per cent of our advertisers in 20/20 magazine are repeat customers. Join us.

We have two available options to support this important initiative including placing an advertisement within the feature of your choice or, participate in creating a feature article with partnered content. For more information about our partnered content that can be formatted into single or double-page article options or for discounted ad rates in this issue, contact:

Ronda Landygo
Executive Director, Partnership & National Business Development
Associate Publisher, 20/20 magazine
Tel: 1-877-880-3392
Email: Ronda.Landygo@cme-mec.ca

Tailor your message, gain new business opportunities, expand your market reach. Share your solutions with leading industry decision makers from coast to coast. Leverage the only magazine the represents Canada's manufacturing and exporting sectors.

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Engaging Younger Generations for Higher Productivity

By now it’s likely that you’ve noticed or experienced some interesting differences between how younger generational employees prefer to approach and undertake their work as compared to previous generations. I don’t suggest this as a bias, but rather an observation that is growing in popularity amongst many of my clients

Specifically as today’s younger employees are amidst some of the most highly educated generations to ever enter the workforce (and in many instances carrying a tremendous amount of debt as a result), we are faced with some interesting challenges in how we structure, motivate and integrate employees in order to ensure continued high levels of productivity.

Not convinced that this is a time sensitive challenge?

Consider that statistics in North America show that at present the Baby Boomers represent 29 per cent of the workforce and are declining, whereas the Millennials represent 26 per cent of the workforce and are growing (sorry Generation X, you remain a minority at 22 per cent). So if you’re not thinking about this now, when do you believe the right time might be?

From the research we’ve conducted, the top three challenges that manufacturers and distributors across North America are facing today relative to integrating younger generational employees are as follows:

1. A general lack of desire to accept or work in low paying, highly repetitive jobs.

2. Dissatisfaction with a top down management approach to decision-making.

3. High expectations surrounding rapid career advancement and personal fulfillment.

Do any of these challenges sound familiar? If they don’t today, it’s quite likely they will tomorrow.

This said, engaging and sustaining the employment and talent of younger generational employees serves to be a particularly difficult challenge for manufacturers, as much of the work historically has been highly repetitive, managed by a top-down leadership approach (derived from the industrial age I might add) with very few opportunities for advancement. In essence, manufacturers are poorly positioned as it pertains to the challenges listed above.

The solution however to this challenge is not as complex as you might think.

Just over a year ago I had the good fortune of working with one of the world’s top bottling and snack food companies, who had deployed a unique solution to these outstanding challenges. Their approach to engaging younger generational employees while increasing productivity was built upon the desire to increase interest in operational roles, as most of their new staff preferred to move into an office environment.

Their approach was quite simple in nature:

1. All new hires began their role in operations before ever transitioning to their chosen career path.

2. New hires were placed in leadership roles (directly or indirectly) managing long-term unionized staff.

3. Following the two-year stint in these positions, new employees were free to transfer out of operations and move into their chosen career — Accounting, Finance, Sales or Marketing if they decided to do so.

The objectives of this shift were quite simple.

By having all new employees engage first in operational roles there was an increased chance employees would decide to remain in these roles if they found the challenges and opportunities aligned with their individual needs. Something that was difficult to convince younger generational employees of once they moved into an administrative role.

In addition any employee who chose not to stay in operations had a significantly greater degree of knowledgeable and expertise as to how the business operated, from the ground up, which in turn would make for better decisions and increased collaboration across the business. These better decisions would support higher levels of productivity in the future, as the business would begin to have an “operational mindset.”

Lastly, younger employees in operational roles meant more new ideas, new solutions and openness to change, which would breath new life into the operation and in turn provide new solutions to increase productivity.

Only time will tell if this approach yields the desired outcomes, but it sheds light on some creative means to build a stronger more productive business that in turn engages younger generational employees in how the business operates, creating a steep learning curve while positioning them younger employees well for future advancement within the business.

So where to from here? I would suggest that beginning immediately an element of your strategic agenda include considering new approaches to engaging younger employees in order to minimize your talent gap and maximize your ability to continue to thrive in this booming economy.

How are you changing the structure of your business to accommodate younger generational employees?

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A refresher on selecting the model and financial arrangement that’s right for you

By Treena Hein

Purchasing a forklift for the first time or simply replacing one? The absolutely crucial first step in the process is to have a site survey done. “Even if you’re sure of your options and just want to replace what you’re using, have a reputable dealer do a site assessment,” says Jim Chesla, vice president of businesses and product development at Stärke Material Handling Group in Niagara, Ontario. “It’s a chance to double-check, evaluate and consider new technology that may do a great deal to maximize efficiency and safety while minimizing costs.”

Site survey results can be very surprising. “You may be able to reduce the number of forklifts you have, or employ an attachment that can accomplish several tasks that are currently being done manually,” says Chesla. “Changing tire type can boost air quality as well as safety, depending on the surfaces involved and substances that could potentially spill indoors or out.”

A site assessment will also verify that load and height measurements are accurate. Forklift capacities are all based on a 24-inch load centre, Chesla explains, and if loads extend out beyond that point, capacity decreases. “We need to know maximum weight, maximum height, heaviest load at top height, and things like ensuring that the lift can enter racking and clear all overhead and aisle widths,” he says. “It’s like plumbing. We know the available ‘fittings’ of the forklift, and we need to know the workings within your facility so that they can be matched properly. We look at ramps, floor types, usage, obstructions, safety, everything.”

Power source choice depends on the applications. Each one has its advantages and disadvantages. Diesel and gas-powered forklifts offer variable power and more torque. Today’s AC Electric forklifts have to be charged in their charging bay, but are obviously emissions-free and offer the lowest overall operating costs, with fewer moving parts and less overall maintenance.

Forklift types available these days include highly-manoeuvrable three-wheeled models, reach trucks (electric, narrow-aisle forklifts) and order-pickers (also called stock-pickers or man-up forklifts, which allow the operator to move on an elevating platform to select loads). Turret forklifts fit in very narrow aisles and employ a rotating mast, and stand-up counter balance electric forklifts are best-suited for quick loading and mount-dismount.

Chesla believes the aspect of forklifts where quality matters is the power train. “It’s really everything,” he says. “That’s where the big brand names engines such as GM, Nissan, Yanmar, Cummins and Perkins tend to be more trusted, and a well-backed warranty policy is a very important sign of quality.”

After you have made your decision, have a detailed discussion with your dealer about whether to lease or purchase. Chesla points out that purchasing can save working capital and makes a forklift much more affordable. “About 35 per cent of our business is leasing to manufacturers,” he says. “Leases can also be seasonal, and there are very creative ways to tailor the lease to the customer.” Guaranteed maintenance plans are included with leases, but can also be set up with a purchased or leased forklift.

Also go over after-sale costs related to operation and maintenance such as fuel surcharges, environmental waste oil and filter disposal charges, operator training costs, possible technician maintenance training and more.

“And after the purchase, as you do with all assets, track operation and maintenance costs,” Chesla says. “A detailed and logical purchasing process with a reputable dealer will mean safety and efficiency are optimized and every forklift dollar gets put to good use.”

Jim Chesla, Stärke Material Handling Group
jchesla@starkeforklift.com 1-877-435-4352 X224
www.starkecanada.com

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CME’s Global Business Services

CME’s Global Business Services team offers a full suite of products and services designed to help Canadian companies save money and grow their business internationally.
These services include:

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Opportunity Matchmaking — Enterprise Canada Network

Enterprise Canada Network [ECN] provides Canadian companies with quick and easy access a database of over 21,000 qualified international business and ­technology partners.

Through ECN, Canadian companies can create their own Opportunity profile to gain broad or targeted exposure in over 54 countries through 600+ business organizations and chambers of commerce.

Additionally, ECN acts as a guide for Canadian companies by providing a single window interface to export information and publications to help them go global. This information includes items such as:

  • Current Export related publications;

  • Database of export related assistance programs;

  • Logistics information;

  • Trade Financing information, and a

  • Event calendar of export related activities

For more information please visit: www.enterprisecanadanetwork.ca or contact: nancy.mackneson@cme-mec.ca

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International Business Training — Export Success Program

Are you interested in growing your business internationally? Are you new to exporting? Are you and your team ready to take on new export markets? Canadian Manufacturers & Exporters, Canada’s largest industry association, can help.

CME’s Export Success Program is tailored to the needs of businesses interested in growing through international business development. Our condensed FITTskills sessions offer you and your team the fundamentals of exporting so that you can reach to your global potential faster.

For more information please visit: www.exportsuccessprogram.com or contact: Emiliano.introcaso@cme-mec.ca

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Global Intelligence — Export IQ

Export IQ is an education platform designed to empower Canadian businesses with information on the latest trends in international markets, critical intelligence on business opportunities, market-entry strategies, regulatory reforms, trade negotiations and minimizing risk to expand and profit globally.

Export IQ showcases information on the latest export topics and international business opportunities and is delivered through conference calls, webinars, Lunch & Learn session and workshops.

For more information or to submit a proposal, please visit:
h
ttp://www.cme-mec.ca/english/global-business-services/export-iq-webinars.html
or contact: stephanie.lessard@cme-mec.ca

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A clean solution to a dirty problem

By Dan Dakin

When more than 100 litres of diesel fuel poured into Ontario’s Welland Canal on June 18, John Brinkman’s frustration level rose like the water level in a canal lock

Sitting in his office less than 25 kilometres away, the co-founder of Imbibitive Technologies wanted nothing more than to drive to the scene with his company’s oil cleaning solution and take care of the problem himself.

“They’re going through the motions. You have fuel spread out on the surface of the water and you’re trying to vacuum it up? It doesn’t really make sense,” he said, referring to the more traditional oil spill clean-up method.

Brinkman has made it his life’s work to figure out how to use some fairly old technology to clean up environmental disasters big and small. In the case of the Welland Canal spill, it was a minor 100-150 litres that dumped into the water. But Brinkman’s Imbiber Beads could easily be used to clean up a spill infinitely bigger than that.

So where did the technology come from? Well, diapers actually.

Originally invented by a scientist for Proctor & Gamble, super absorbent polymers were used in Pampers disposable diapers because they would collect liquid without re-releasing it.

While working on a separate product, Dow Chemical Company came up with its own variation of an absorbent polymer product in the 1970s that they called Imbiber Beads.

Unlike other absorbent materials like straw or cat litter, the beads would soak up liquid, expand in size and essentially turn the liquid into a solid. Even if you squeezed the beads, they wouldn’t re-release the liquid. It was a fantastic discovery, but one Dow Chemical wasn’t particularly interested in commercializing.

For years, Imbiber Beads got little interest from consumers. When Brinkman first saw them in 1987 at an environmental trade show in Toronto, it was at the booth of a small distributor who was trying to ditch what supply it had left.

Brinkman knew the beads could change how oil spills were dealt with, but the big turning point in his own mind came on March 24, 1989 when a tanker called Exxon Valdez ran aground in Alaska, dumping tens of millions of litres of crude oil into the water. It was one of the worst human-caused environmental disasters in history.

It was then that Brinkman decided he wanted this to be his new focus. He spent three years negotiating with Dow Chemical before finally acquiring the manufacturing and sales rights. In 1994, he and the Dow scientist who invented Imbiber Beads launched Imbibitive Technologies.

Fast-forward 20 years and the company is stronger than ever. Although Brinkman’s co-founder Dr. Richard Hall, passed away in 2011, his expertise lives on through a handful of scientists who now work for Imbibitive.

When the Deepwater Horizon oil rig exploded in the Gulf of Mexico in 2010, Brinkman realized his company wasn’t big enough to handle large orders from disaster clean-up companies responsible for major environment catastrophes like that one.

“I realized I had to change this company and the way we operate,” he said.

Imbibitive brought in new employees to handle marketing, sales and research, and changed its manufacturing process.

While the company is headquartered in Welland, ON, there are separate research and development facilities near Dow Chemical’s headquarters in Michigan and a manufacturing plant in Arkansas.

Brinkman said unlike the traditional oil spill clean-up methods that capture up to 10 or 15 per cent of the spilled liquid, the Imbiber Beads capture close to 90 per cent, while leaving the water in place. The key is getting the polymer beads into the contaminated water as quickly as possible.

“Timing is everything and every study you read about, the slick spreads to unmanageable proportions in a matter of hours,” Brinkman said.

In Japan, beads are now stored in 23 high-risk spots along the oceanfront so that they can be deployed within minutes of a spill. There are also helicopter delivery systems being developed to quickly get the beads to spill sites from further away.

International sales have been brisk. There’s a new distribution deal covering a number of Caribbean countries. They’re also being used in China, Germany, England, Singapore and Nigeria, among other places.

But what about North America? While there have been some sales and other development projects on Imbibitive’s home continent, Brinkman is frustrated by the industry’s slow uptake in what he sees as a far superior clean-up method.

“There’s resistance to change: ‘That’s how we’ve always done it,’” he said. “But that’s no excuse.”

The company is now working on a case study to help sell directly to the organizations that could be ­impacted by spills — like the St. Lawrence Seaway Authority that operates the Welland Canal.

“We’re tackling it from the end-user perspective instead of the spill ­contractor perspective. Their goal is to clean it up as quickly as possible,” said Brinkman.

“We can show that using Imbiber Beads can reduce the time of the spill response, can collect significantly greater volumes of spilled liquids and reduce the impact on the local environment,” he added.

While aiming to grow the spill response market, Brinkman knows the company has to look elsewhere for overall growth, as well.

“You can’t build a business plan around waiting for oil spills,” he said. “We define ourselves as a specialty absorbents company. We have a whole range of preventative measures.”

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Interview with top 3D printing CEO: How 3D printing will change manufacturing

By Jakob Sand, Partner, BDO Global TMT M&A Leader

We interviewed the CEO at one of the world’s most dominant 3D printing companies:
Avi Reichental of 3D Systems

Innovation and startup activity is growing at amazing speed, and major tech companies — such as HP and Autodesk — are entering the market. Read on to learn about 3D Systems’ business strategies, and why Avi Reichental thinks 3D printing will change the way humanity manufactures physical things.

BDO: 3D Systems has been an incredibly active buyer in the 3D printing industry in recent years. What have been the main strategies behind the many transactions?

We have directed much of our time and resources over the last few years in positioning ourselves favorably within the areas in which we see the most value in 3D printing over the long term; what we refer to as our 4 M’s: Materials, Metals, Medical and Manufacturing.

BDO: Major IT companies — such as HP — are poised to move into the 3D printing market. What will this mean to the 3D giants of today, such as 3D Systems and Stratasys?

As the founders and pioneers of 3D printing technology, it is tremendously validating to have a company like Hewlett Packard enter this space. We view their announcement as a net positive for our industry. However, having spent more than 30 years growing our company and advancing this technology, we’ve learned that there is no one-size-fits-all approach. With a full range of print engines, print materials, cloud printing services and an integrated content-to-print workflow, we believe we are well positioned for growth, and intend to remain innovators and leaders in the industry.

BDO: Startups all over the world are creating new, affordable 3D printing technologies at a high pace. Will 3D Systems keep buying innovation in the way you have done so far?

There has certainly been an influx of talent and creativity into the 3D printing space in the past few years. With every new industry, I expect to see consolidation as we move forward. We’ve benefitted from this rising interest in 3D printing, both in the technologies and in the talent we’ve been able to acquire, combining that talent with a lot of R&D to develop many of our own technologies in house. Our strategy has always been about positioning ourselves favorably in the areas where we see the most long-term potential: on the factory floor, in medical labs and offices, on the engineer’s desktop and in homes and schools. We’ve not only developed cutting edge 3D printers and materials, but the supporting technologies necessary to provide a seamless, integrated workflow from the virtual to the actual and back again. We are now entering a phase where we intend to fine-tune and scale our acquisitions and leverage our unrivalled portfolio of products and services.

BDO: What are the most promising new trends in 3D printing right now?

There are so many amazing things going on in 3D printing today, it is hard to single out only one.

Applications for healthcare are certainly high on that list. Already, we are able to use CT/CBCT scan data from individual patients to create patient specific dental and anatomical models, custom surgical guides, implantable devices, exoskeletons, hearing aids, prosthetics, and braces for scoliosis and other applications. And that’s just to name a few. Using the same patient specific data can also provide surgeons with accurate planning models and virtual training and operating platforms for use in preparing some of the most complex surgeries performed today.

I would also point to how 3D printing offers ‘free complexity’, providing incredible opportunities for manufacturers. A 3D printer doesn’t care if it produces the most rudimentary shape or the most complex. Removing this barrier enables manufacturers to design for performance, which translates directly into improved functionality, reduced weight and greater strength for parts. The implications in industries like aerospace and automotive are staggering. With no tooling or setup needed to create a part, we’re now seeing the dawn of the age of mass-customization — every part tailored to user specifications. This has obvious applications for businesses in fashion, footwear and accessories but also in healthcare. Invisalign, for example, 3D prints millions of clear aligners each year, made to measure for each individual patient. And when you apply the idea of mass customization to the food printer we announced earlier this year, you start to see the possibilities of personalized nutrition just around the corner.

BDO: When will access to and/or ownership of 3D printers become mainstream?

3D printers are already main stream in industrial uses. Almost every company who manufactures products uses 3D printing at some phase of their development cycle. Falling prices and rising usability are making this technology accessible to everyone from garage entrepreneurs to blue chip industrial giants. Our goal is to expand and enhance access by providing a digital thread that integrates every step of the workflow, from design to modelling to manufacturing to inspection to data collection. This end-to-end connectivity enables push-button manufacturing systems with uptime reliability and repeatability that really represent a paradigm shift in manufacturing as we know it.

We’re also reimagining what the engineer’s desktop of the future looks like, providing tools that combine utility, functionality, simplicity and cost effectiveness. That includes desktop 3D printers, desktop scanning and inspection devices and new devices like our Touch haptic device, which provides a physical experience for designers, as if they are working with digital clay.

Finally, we’re seeing a mainstreaming of 3D printing in the home and in schools by simplifying and gamifying content creation, creating a social experience around 3D content, and—most important—providing a plug-and-play 3D printer at a consumer price point lets everyone bring their ideas to life.

To learn more about BDO’s perspective on 3D printing, visit BDO’s Tech and Media Watch blog: http://bit.ly/15clXT6 or contact Scott Rodie, BDO Canada Technology & Life Sciences Leader, at srodie@bdo.ca

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Canadian Manufacturers & Exporters (CME) — Southwestern Ontario Recognition Night

The 20th Annual Recognition Night held in London, ON on May 6 was a great success, with more than 220 people in attendance and $16,000 in scholarships presented. Over the last 20 years more than 100 scholarships amounting to over $100,000 have been awarded!

The event, organized by the CME Southwestern Ontario Branch, brings together people related to manufacturing and exporting to recognize top manufacturing students in Southwestern Ontario. The scholarships are designed to promote education related to manufacturing and recognize the achievements of promising students.

This year, eight scholarships were awarded to students from Thames Valley District School Board (TVDSB), London District Catholic School Board (LDCSB), Fanshawe College and Western University. These students are all currently enrolled in programs related to manufacturing.

The scholarship recipients were Erica Glatt and Alex Churchill from Western University, Kaz Szydlowski and Kenneth Homewood from Fanshawe College, Spencer Beer and Jeff Williams from LDCSB and Shawn Cummings and Mitchel Priestap from TVDSB.

The keynote speaker was Sandra Pupatello, director of business development and global markets at PwC and CEO of WindsorEssex Economic Development Corporation. Craig McIntosh, CME’s national board chair and executive chairman of Acrylon Plastics gave an excellent CME address to the audience as well.

A special thank you goes to the organizing committee and the 29 local sponsors of the night!

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3D printing set to revolutionize business in industrial manufacturing

By Markus Pfeifer — Partner and Daniel Antolin — Principal

3D printing technology is about to transform industry by changing long lasting principles of industrial manufacturing. It is not only improving the way we produce things but how we do business and is sure to shift market environments and revolutionize present business models. The commercial implications for industrial goods manufacturers and new fields of action that will be created by 3D printing technology should be top of mind for senior management

3D printing — also referred to as additive manufacturing — is “a group of layer manufacturing techniques which have the distinguishing feature of creating parts by the controlled addition (…) of material.i” In other words, 3D printing creates new objects by continuously adding one layer on top of the other according to a pre-defined shape of an object. The technology has been applied in industrial manufacturing for more than 20 years, which raises the question: why did it take this long for the technology to garner so much interest?

The answer is simple: technological advancement. Until 10 years ago, 3D printing technology was limited to the relatively slow production of small plastic objects and some specialty fabrics. Primary areas of application were prototyping and low volume production of specialty products. Aside from this, 3D printing production was relatively expensive and created low value for users so it remained a niche production method, not suitable for medium or large-scale industrial manufacturing.

Today, the situation differs significantly. Modern industrial 3D printers are able to produce precise, high quality products of different sizes fast and at relatively low costs. What’s more, they are able to replicate complex structures, which cannot be produced by other production technologies. The processed materials that can be used range from simple plastic to almost all kinds of metals (including titanium, aluminium and others) and even biological matter. However, 3D printing technology is not expected to replace traditional production methods like material transformation or degrading. Instead, it is predicted that both production techniques will become increasingly combined and integrated.

As of today, the most successful areas of application are prototyping low volume specialty products and highly customized products — especially in the aerospace, medical, capital goods and automotive industries.

Altogether, 3D printing technology is continuously developing and will become more and more relevant in the near future through expanding fields of application. With an increasing number of industrial companies using 3D printing, all industrial manufacturers should be aware of the strategic and commercial implications the technology presents.

Given the rising relevance of this technology, do you feel adequately prepared for its impact on the strategic setup of your business?

Key benefits of 3D printing

In comparison with traditional production methods, 3D printing enables:

  • quicker, more economic and more flexible product development

  • less limitations for complex product shapes and designs

  • shorter product lifecycles

  • less investment in production tools

  • less dependence on returns to scale

  • reduction of set-up time and handling complexity

3D printing not only provides benefits in terms of efficiency and costs, it generates flexibility for customization — and interlinking a printer network opens opportunities to better serve and develop markets.
3D printing also presents opportunities for:

  • flexible and on demand satisfaction of global customer requirements

  • efficient product distribution and production (e.g. digital product distribution and decentralized 3D printing)

  • absorption of market niches with highly specific, low volume but profitable product lines

For these reasons, it is more than likely that an increasing number of industrial manufacturers will adapt the new technology. And with more and more companies exploiting the potential of 3D printing, existing business models and processes, market structures and competitive environments are about to change dramatically.

Challenges of the new technology

Of course not all aspects of 3D printing are nice and easy. Despite the opportunities and benefits the technology presents, there are three key challenges and obstacles still hindering the full integration and rollout of 3D printing technology:

  1. Production speed: Processing time of 3D printers is still slower than traditional production methods and therefore less economical for high volume production.

  2. Internal resources: The first internal barrier companies engaging in 3D printing face is limited resources and ability or willingness to invest. The lack of a technically skilled workforce is the next barrier companies must overcome. Last but not least, many companies face internal scepticism about the possibilities and consequences of implementing the new technology.

  3. Legal obstacles: Legal regulations and norms on the approval and admission of products produced by 3D printers are undefined and/or vague. Equally important, the international legal enforcement of intellectual property, licenses and patents for 3D printed products does not meet most manufacturers’ requirements.

Nonetheless, it is almost certain that technological and legal developments as well as positive experiences and benchmarks will help companies overcome these obstacles in the coming years, which will revolutionize the commercial environment of industrial firms.

Commercial implications that should be considered

3D printing is about to change both the way parts are produced and the way business is conducted. 3D printers will have a significant commercial impact on the industrial manufacturing business as a whole, and there are four key aspects that need to be tackled to fully exploit the commercial potential of this technology.

1. Change of competitive environment

3D printing allows for different products to be created within one production line – independent from economics of scale. By creating the ability to produce low quantities of product economically, 3D printers cause a reduction of market entry barriers –especially within existing market niches. Consequently, the probability of cross-barrier competition and new suppliers entering established markets increases.

2. Dynamic product development

Faster prototyping, product development and production ramp-up will decrease product lifecycles. This will likely lead to higher rates of product innovation, specialization and customization. In which case, a faster deterioration of market prices for mature products should be expected.

3. Decentralization

The ability to produce single products on demand at any location in the world by forwarding a digital production file to a 3D printer will have significant impact on logistics and supply chain management. The global distribution of products and spare parts could be conducted through a completely new channel, which would be faster, more reliable and more economical. Stock capacities and logistic expenses could be reduced to a minimum through regional on demand production of the required product.

4. Change of after-sales structures

Industrial manufacturers and technology experts also agree that 3D printing has the potential to revolutionize after-sales businesses. Bringing a set of common spare parts to a service or repair job may no longer be needed, and the timing between diagnosis and the delivery of the right spare part can be reduced to a printing operation. This means keeping stock of expensive, rarely used spares – if not of all printable spares – would be a thing of the past. Cheaper, faster and precise product availability with minimized logistics while delivering identical product quality are strong arguments for a disruption of global aftermarkets of industrial manufacturers.

Fields of action

It is clear that 3D printing technology will have an impact on the competitive landscape, product development and after-sales business – with a high margin source of revenue. At the same time, it offers a variety of opportunities to uncover new market potential and to strengthen current market positions. Executives must acknowledge the opportunities and changes this technology will create in the market and take the required actions.

  1. On that account, Homburg & Partner recommends businesses evaluate their current set-ups using the following checklist:

  2. Do we have full transparency on the effects of 3D printing technology on our market environment and business model?

  3. Have we identified business areas, products and processes that could benefit from 3D printing technology?

  4. Have our market strategies been revised and adapted accordingly?

  5. Do we have the required technical and commercial expertise and resources?

  6. Do we have the right measures to preserve and protect intellectual property in place?

  7. Are our commercial processes - sales and after-sales – streamlined for 3D printing?

  8. Are our sales organizations and channels prepared for new commercial implications?

If even one of these check points cannot be confirmed, it is highly recommended to take action and enact necessary measures.

Moreover, an internal and external in-depth analysis and evaluation of 3D printing technology — together with the affected functions — could provide valuable insights on an operational and strategic level.

Finally, the involvement of industry experts is a viable step to prepare your business for the upcoming technological changes – especially if your organization lacks internal expertise to cope with the illustrated commercial implications.

Your contact person on this topic:

Markus Pfeifer — Partner
Tel.:+49 151 52600975
markus.pfeifer@homburg-partner.com

Daniel Antolin — Principal
Business Development America
Tel.:+49 151 52600969
daniel.antolin@homburg-partner.com

Homburg & Partner:
Excellence in Market Strategy, Sales & Pricing

Homburg & Partner is an internationally operating management consultancy focusing on Market Strategy, Sales & Pricing and was founded by the renowned marketing expert Prof. Christian Homburg in 1997.

In an independent study called “Hidden Champions in the Consultancy Market” conducted in 2012, Homburg & Partner was honored as the best consultancy for Marketing & Sales for the second time in a row. More information on:

www.homburg-partner.com



i Emanuel Sachs, Michael Cima, James Cornie, David Brancazio, Jim Bredt, Alain Curodeau, Tailin Fan, Satbir Khanuja, Alan Lauder, John Lee & Steve Michaels (1993): Three-Dimensional Printing: The Physics and Implications of Additive Manufacturing, CIRP Annals - Manufacturing Technology, Volume 42, Issue 1, 1993, Page 257
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Canada Makes is a leading network advocating the adoption of industrial 3D print technology

Canada Makes is Canadian Manufacturers & Exporters’ additive manufacturing network. Its mandate is to encourage and enable the adoption of 3D printing through its partnerships with industry, educational institutions and additive manufacturing firms

“Canada Makes provides the thought leadership surrounding adoption and commercialization of additive manufacturing in Canada through CME’s vast networking clout and by partnering with leading edge companies and institutions,” said Martin Lavoie, CME’s director of policy.

Soon after its launch in 2014, Canada Makes partnered with the National Research Council to connect 10 SMEs with a program designed to enable demonstration projects using metal, laser additive technology.

“For companies who are prepared to complete a prototype but have not yet adopted laser additive technology into their manufacturing process, the NRC program is an invaluable opportunity,” said Frank Defalco, communications specialist for Canada Makes.

As a result of the successful prototyping through the first round of projects a further $160,000 has been earmarked for at least 25 more companies to participate. To be eligible, companies must be referred to CME by an Industrial Technology Advisor through the Industrial Research Assistance Program of the National Research Council of Canada.

“The advantages of metal additive manufacturing/3D printing are extreme design flexibility and ability to manufacture hollow shapes, ability to have multi-material multilayered structures, ability to make one-of parts without any additional tooling and much more,” said Vladimir Franjo, ITA lead for Ontario. “One of the most promising applications has been manufacturing of custom fixtures and tooling for various manufacturing processes.”

Since the launch in September 2014, Canada Makes has forged partnerships with various academic and commercial institutions to develop a network capable of demonstrating and supporting the benefits and potential of 3D printing in all its forms. Partner organizations include: University of Windsor, Saskatchewan Polytechnic, University of Waterloo, Sheridan College, Mohawk College, Niagara College Canada, Queen’s, BC’s Emily Carr Art and Design. Private sector partners include Cimetrix Solutions, Renishaw Canada, Hyphen, Javelin Technologies, Precision ADM, Objex Unlimited and Agile Manufacturing.

For a complete list of Canada Makes partners, to find a Canada Makes demonstration event in your region or for information on becoming a member of Canada’s premier additive manufacturing network visit www.canadamakes.ca or contact
Martin Lavoie, director of policy, Canadian Manufacturers & Exporters martin.lavoie@cme-mec.ca

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