Perhaps one of the more intriguing developments of the past decade, on-demand manufacturing has been transforming supply chains and is now poised to spearhead a revolution within the industry. How has this technique made such an impact? Let’s begin by examining the basics, as described by the manufacturing experts at Fictiv:
“On-demand manufacturing…is a method of producing goods only when needed and only in the amounts required. Transitioning to an on-demand manufacturing model gives companies more production flexibility and removes the costs that come with housing inventory. Those savings give organizations the capacity to create more specialized products to meet the specific demands of customers.”
Being able to produce “on-demand” is just the tip of the iceberg, though, and the advantages of this process warrant further examination. Read on to learn more about the revolutionary benefits of on-demand manufacturing that are transforming supply chain management.
Putting Limits On Overproduction
Traditional manufacturing methodologies almost always run the risk of overproduction. Manufacturers have to estimate the demands for certain products, and thus they can end up creating more of something than what is actually needed by consumers. This is particularly prevalent in industries where machines have long setups (and hence manufacturers want to produce as much as they can when they can) or where needs shift rapidly, like in fashion.
On-demand manufacturing works differently, however, and enables companies to produce only what consumers order. As a result, unnecessary production is minimized, and there are huge stockpiles of extra product that needs to go to waste because they can’t be used.
Cutting down waste doesn’t just improve efficiency or put a few extra dollars in a manufacturer’s pocket. By eliminating waste, on-demand manufacturing is also helping take steps toward improved sustainability and decreased environmental impacts.
Because of the savings brought about by on-demand manufacturing, brands can also experiment with new methodologies within their own supply chain that could be more environmentally friendly—organic materials, reusable components, etc.
Perhaps the greatest benefit to come from the advent of on-demand manufacturing is the complete streamlining of operations through a reduction in costs, increase in efficiency, and improvements in various processes. The centralization and automation afforded by the on-demand model allow for a wide range of improvements.
The reduction in lead times, for instance, brought about through more efficient management of smaller production runs, can help brands operate more quickly and change focuses rapidly as the conditions of their industry evolve. Meanwhile, reduced overheads help keep the costs of production runs low, and allow your brand to focus its energies on higher-level tasks.
Managing The Potential Downsides Of On-Demand Manufacturing
To maximize the benefits brought by on-demand manufacturing, it’s important to understand the possible drawbacks so that you can mitigate them.
Chief among the risks you may run with a transition to on-demand manufacturing is a difficulty sustaining high production volumes, and it’s for this reason that you may want to consider limiting on-demand production to early prototyping or the introduction of new items.
Even with such possible downsides, though, on-demand manufacturing has shown itself as an adaptable process capable of helping companies navigate rapidly changing conditions like the recent COVID-19 pandemic. Brands wanting to stay competitive through these turbulent times will definitely want to consider the on-demand methodology as part of their playbook.