Small Firms Get New Manufacturing Edge: 3-D Printing in the Cloud

The camera mount on this drone quadcopter was designed by Fusion Imaging and created using Shapeways, a 3D-printing service.
The camera mount on this drone quadcopter was designed by Fusion Imaging and created using Shapeways, a 3D-printing service.PHOTO: FUSION IMAGING

There’s been a lot of talk in recent years about small companies rushing to adopt 3-D printing, taking advantage of the ability to turn computer-generated designs into physical objects. Yet even though the technology can crank out items more cheaply than traditional manufacturing, for many small firms the investment is too big: Higher-end printers that produce finished products can cost thousands or even millions of dollars, and require specialized skills to use.

Enter a new batch of cloud-based services—such as Shapeways, Cubify, i Materialize and Sculpteo—that offer to do the 3-D printing for small businesses. Companies can work up a design and upload it to a cloud server, and the cloud business at the other end 3-D prints it. The cloud companies sometimes offer services such as packaging, shipping and billing as well—allowing small businesses to focus on core areas such as design.

The result, say experts and entrepreneurs, is a chance for forms to launch and crank out products with little or no capital outlay. It also allows them to rethink common problems such as carrying inventory and diversifying their product line.

“For small businesses and groups within enterprises, 3-D service bureaus will play a growing role,” says Pete Basiliere, an analyst with Gartner Inc. He says such services will open up new avenues for prototyping and manufacturing, as well as low-cost market testing of designs.

An idea from the sky

The story of Warren Alexander and his company, Fusion Imaging, shows how cloud services operate and what they offer. Last year Mr. Alexander, a marketing specialist in Australia, was flying a DJI Phantom hobbyist drone quadcopter when he met Hayden Bao, a designer and fellow drone enthusiast. During the conversation, they realized they both needed easier ways to attach propeller guards to their drones. No products were available, so they decided to make their own.

They put together a design and uploaded the finished file to Shapeways, a 3-D-printing service based in the U.S. and the Netherlands. The Shapeways platform produces about 180,000 products a month for its users, including jewelry, coffee mugs, home décor and accessories for electronic devices. About 40% of its users are small businesses, and the rest are individuals producing goods for their own use.

When Shapeways receives a file like the one from Fusion Imaging, the staff vets it to make sure that it is printable and won’t produce a product with physical defects, such as plastic walls that are too thin to hold their shape. The finished product is posted for sale on the Shapeways online community. When an order comes in, Shapeways manufactures it to order, packages it and sends it to the customer. The site also promotes its designers to its 20,000 members and highlights some of their work at trade shows.

A year after signing on with Shapeways, Mr. Alexander says Fusion has become the largest shop on the site and has sold 3,000 items in 70 countries.

To be sure, there are limits and caveats to these cloud services. For instance, there’s the length of the production cycle. Even though 3-D printing is fast, adding a middleman makes the turnaround longer than it would be if small companies were doing the printing themselves.

Pricing is also more complicated. At Shapeways, for instance, the site determines how much it will cost to manufacture each item, based on the complexity of the design and the materials, and factors in a profit margin for itself; the designer then determines the price that it will charge the retail customer. Shapeways also charges a fee of 3.5% on the marked-up price.

Bigger changes afoot

For all that, though, Mr. Alexander expects the use of 3-D printing to spread rapidly. “What is a competitive edge for us is something that everyone will have in a few years,” he says, adding that the use of a 3-D-printing service allows Fusion Imaging to focus on distinguishing itself with its designs, he says. Along with the propeller guard, the company offers other products such as a GoPro camera mount for the Phantom.

Convenience aside, other entrepreneurs say 3-D printing services change how small businesses approach fundraising and risk.

“3-D-printing services allow you to be your own Kickstarter,” says Robert Blinn, co-founder of New York-based jewelry firm Gotham Smith.

Designers can market-test demand for a new product without spending money on producing inventory, he says. The product can be refined based on feedback on individual orders, using customers to test the product. And the money from initial orders can pay for the cost of production.

Mr. Blinn, who gave up a career in hedge funds to study computer-aided design and create products, says Gotham Smith has had quick success during the past year on Shapeways, and that some of its designs are now for sale at the Museum of Modern Art store.

“We haven’t necessarily grown faster because of 3-D printing. But our startup costs were only $100 a month for Web hosting,” he says. “If we had used traditional manufacturing, we would have had to spend a lot more money upfront to get the same results.”

3-D printing services also allow small businesses to take advantage of what Mr. Blinn calls the “long tail’ of product development.

“We can have five or 50 products for sale, and it doesn’t matter, because we don’t have to keep any inventory,” he says. That paves the way for a level of customization and niche targeting that wouldn’t be possible for most conventional manufacturers.

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