Leading logistics providers are constantly exploring new possibilities to become more efficient, more locally focused and more connected globally in order to achieve greater success, including 3D printing technology. The relationship between the 3D printing and logistics industries is fascinating for a multitude of reasons. In some ways, the integration of 3D printing into the logistics and supply chain management field seems like a natural, almost inevitable, progression. After all, 3D printing has proven itself as a revolutionary innovation to manufacturing, so the exploration of its potential applications in the distribution process seems like a logical step forward.
Even the most prominent specialists in logistics and supply chain management, such as DB Schenker and DHL, are closely studying the influence that 3D printing will have on how these services are provided to customers. 3D printing has had a substantial impact on the arenas of logistics and supply chain management, and will continue to play a major role in these fields as more companies learn the optimal ways to adjust to and implement the technology.
The Research & Development Tax Credit
Enacted in 1981, the federal Research and Development (R&D) Tax Credit allows a credit of up to 13 percent of eligible spending for new and improved products and processes. Qualified research must meet the following four criteria:
- New or improved products, processes, or software
- Technological in nature
- Elimination of uncertainty
- Process of experimentation
Eligible costs include employee wages, cost of supplies, cost of testing, contract research expenses, and costs associated with developing a patent. On December 18, 2015, President Obama signed the bill making the R&D Tax Credit permanent. Beginning in 2016, the R&D credit can be used to offset Alternative Minimum tax and startup businesses can utilize the credit against $250,000 per year in payroll taxes.
DB Schenker
DiManEx
In order to help alleviate this cost, DiManEx has explored the utilizing of digital stock and consequently, they have also aimed to identify spare or legacy parts in their existing database that can be 3D printed. In fact, their studies have shown that by simply 3D printing merely 2% of existing parts, companies can experience an increase in their EBITDA of nearly 6%. One of DiManEx’s clients was able to reduce its total cost of ownership for the production of spare parts by almost 80% simply by utilizing 3D printing rather than traditional production processes.
Aside from the significant effects on cost and EBITDA, the integration of 3D printing has provided companies with benefits in a variety of other aspects as well. As 3D printing has been more widely adopted, firms have experienced improved customer service, increased availability of parts, and substantially lower environmental footprints due to the drop in waste and logistics miles traveled.
UPS
DHL
Conclusion
There is a wide array of ways that 3D printers can benefit the supply chain. Even at the most basic concrete level, 3D printing has the potential to substantially reduce manufacturing lead times and times-to-market for new designs, as well as expedite the ability to meet customer demand. In addition, the logistics field will naturally adjust to print-on-demand, which eliminates the need to carry inventory. Several firms have already experienced massive benefits of their respective efforts to implement the ever-growing technology of 3D printing into their repertoire.
Logistics companies that utilize 3D printers to consistently develop and improve their products and processes should also be able to draw on R&D Tax Credits to help implement these value-added functions. As we delve deeper into the applications of 3D printing in logistics and supply chain management, these industries will continue to advance as more companies explore the vast realm of possibilities that 3D printing technology can open up.
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Charles Goulding and Tyler Gianchetta of R&D Tax Savers discuss 3D printing and logistics.