3D Printing in Handbag industry, by JOYCE FAN (student no:
53511796)
Regardless of time, handbag is
a necessity item for women to carry personal items who leave home. Nowadays,
handbag is a luxury and fashionable item which reflects personal taste and
self-image.
Since 3D printing technology
was first introduced at 1980s, it has never stopped developing into a much
adaptable technology into the commercial world. It is believed that3D printing
may spur a manufacturing revolution in the handbag industry.
Nowadays, the handbag industry
is facing keen competition. Even luxury brands like Hermes, Channel, Gucci,
Dior, Mui Mui are facing competition from other “affordable brands” like Coach.
With the opportunity presented by globalization, industry players are
advertising and distributing their products around the globe. There is no doubt
that a Hermes handbag can easily be found in large cities around the world,
like Singapore, Tokyo, Hong Kong and Shanghai, etc.
High-ended handbag brands
emphasis on the high-quality, innovative design as well as the limited number
of production. It is believed that only customized handmade handbags can
satisfy personalized needs.
The opportunity presented by Globalization:
- Market
Globalization provides a larger
and better platform (greater market/potential demand) for high performing
industry players to produce and market its products around the globe.
Ø Adopting 3D printing
Companies can benefit from a
higher volume of sales driven by the global demand instead of demand from local
market.
- Cost
(Global demand->mass production->economies of scale)
Besides, economies of scale can
be achieved through mass production, as large quantity of production will
reduce production costs. Producing
larger quantity reduces unit costs of product.
Ø Adopting 3D printing
Easy modeling
With 3D technology, companies
can create low cost product model during the R&D and selling process, which
reduce the related modeling costs. Mass production with 3D
printing technology can be machinery oriented which involves less human resources
employed, this in turn reduces production costs.
Besides, with the 3D printing
technology develops, companies may receive tailored-order of 3D products
instead of mass production. Tailor-made 3D printed product
simplifies supply chain process from online purchase to direct shipping. This
involves lower costs compare to traditional global supply chain activities.
- Risk
Customers from different region
have different taste among handbags. Industry players often produce products
with different size, design, materials for different market and charge at a
different rate sometimes.
Some regions may encounter
economic growth while the other going through a recession. Raise in demand in
some regions may offset the fall of demand in other region. Business risk can be
diversifying through the natural demand stabilizer and the broader product
range with globalization.
Globalization can benefits
companies from reducing the business risk while companies will face higher
global competition when entering into global market compare to local market.
Ø Adopting 3D printing
With 3D printing technology,
the entry barrier can be relatively higher compare to other industries due to
the higher investment/fixed costs of specialized machinery as well as technical
resources.
3D printing machineries, software
and IT support are some of the high cost crucial resources that companies shall
invest on at the first stage of production. This may deter some potential
competition out of the industry.
- R&D
in 3D printing technology
As a recent technology, there
are a number of limitations in the development of 3D printing technology,
including the invention of materials choice.
With the help of globalization
and advanced information technology, industry experts and innovative ideas can
be easily transfer and communicate through face-to-face and online
interactions, which enhances research and development efficiency and
effectiveness.
Contradictions or tensions to work out
through
Consequences of technological
adoption or oblivion
Market: choice & uniqueness
With the 3D printing
technology, the global handbag market can provide a wider choice of handbag for
customers. The technology enables the industry to produce sophisticated designs
that were not possible in earlier years. Besides, more input materials are
expected to be use in production.
Mass or niche production?
It is believed that mass
production of 3D printed handbags can effectively reduce the unit costs.
However, will it erode the product uniqueness and will it lose the produce
uniqueness in the modern market?
There is a high demand on high
quality handbags in the global market, especially from countries with high
economic growth, e.g. China. Some customer demand customized handmade handbags,
which satisfy, personalize needs instead of largely replicated products as it
increases customer’s satisfaction on the uniqueness. Thus, apart from mass
production, it is believed that company may market its tailor-made 3D printed
handbag as a luxury items and target as a high-end market segment, which may
create higher values to the company comparatively.
Company: market structure
With the 3D printing
technology, more complex handbag designs can now be manufacture and the service
and product quality of manufacturers can be enhanced to a higher level. This
may help some companies to foster its market position in local as well as
global market.
Operation: Smaller
manufacturers may close down
In the first stage, 3D printing
technology increase the company’s investment on specialized machines, software
and technicians (operation and R&D). Since the initial fixed costs can be
high for some less financially healthy companies, it may deter some companies
from entering into the market segments. This may decrease some smaller business’s
competitiveness or even decrease the number of smaller manufacturers in the
market under globalization.
Threat: can “limited edition”
product be protected?
With the patent of certain 3D
printed technology expires, small and cheap 3D printers are offer in the market
currently. Will 3D printers enter into the general public homemade market and
people actually print the small-sized handbag at home using some common
materials? This involves the intellectual right & property implications in
3D printing handbag, which highly depends on the future market and technology
development.