Expect 2016 to be a big year for 3D printing. Rapid and positive changes in capabilities, performance, materials, service offerings, and cost are converging to generate greater interest in 3D printing and grow the market. That includes new and better opportunities for resellers and retailers of 3D systems. These changes are driving a number of trends that should speed adoption of the technology and open new markets to 3D printing. I’ve outlined those trends below and provided advice on how resellers might take advantage of them.
Resellers Will Have a Bigger Seat at the Table
You might remember the attention that Microsoft’s then-CEO Steve Ballmer received by his animated chanting of “Developers! Developers! Developers!” at the company’s 25th anniversary event in 2000. He did this to emphasize to his troops that Microsoft could not grow without supporting developers. (Look up Steve Ballmer Monkey Dance to get my point.)
Today, 3D OEMs are making similar, though more subdued, noises about its resellers. In their most recent earnings calls, both 3D Systems and Stratasys announced programs to better support and collaborate with resellers. This includes improved training programs and sales support. Leading overseas OEMs such as Zortrax (Poland), Print-Rite (China), and XYZprinting (Taiwan) are expanding into the U.S. market and are seeking channel partners.
Resellers consequently have a lot of options among 3D OEMs, and that gives them leverage. The best way to capitalize on that is to know the value you bring to the table. That might be a strong sales team, relationships with key customers, or a good technical support infrastructure. You also need to know which OEMs have products that match well with the needs of your customer base. Do your homework, and you might have OEMs competing for your services.
Service and Support Capabilities and Customer Expectations Rising
The commercial 3D printing market is moving past the experimentation stage and into the mainstream for many applications. That means customers will expect a higher degree of reliability and support when something goes wrong. The larger OEMs are beefing up their support capabilities in response, but many still depend on resellers as the first line of support and service.
One OEM that understands this is CEL-Robox in the UK. The company recently announced new service programs that will likely be adopted by other OEMs and resellers. The first is a full system overhaul service where CEL-Robox will rebuild a customer’s printer with updated parts and upgrades. Another option for this program is a dual-material upgrade. CEL-Robox is also offering a professional-level service contract that promises that the customer will have a working machine in a single business day. This is significant, because typical turnaround times for service fixes is two to three days.
Even the most reliable 3D printers will break down, often at critical times. A reseller might carry the best performing system on the market, but that won’t matter as much to the customer who is waiting for a fix to complete a project. Resellers need to find OEMs that have solid products and strong programs to support the resellers’ service capabilities and to back them up when resellers need to escalate problems to the OEM.
High-End Technologies Reach the Mid-Range
Resellers have largely been shut out of the high-end 3D printing market, where systems can cost hundreds of thousands of dollars. Sales volumes there are low, and consequently OEMs sell directly to customers.
In the past year, some high-end technologies have migrated to the mid-range—$30,000 to $80,000. Selective Laser Sintering (SLS) is the best example of a significant technology that is becoming more accessible. SLS systems use a laser to melt powder and fuse it into the desired form. The most common materials it uses are either plastic or metal based. The patent for SLS, held by 3D Systems, expired in 2014, and that has allowed a number of companies to develop their own, cheaper SLS systems.
SLS is used heavily for engineering, product development, and manufacturing applications, typically at large companies that can afford the investment. Now, you can find SLS systems for as little as a few thousand dollars from companies like Sinterit and Sharebot. Prodways, in partnership with Farsoon, and Norge now offer industrial-grade SLS systems priced in the mid-range.
The Sharebot SnowWhite SLS system.
Less expensive SLS systems will appeal to small or mid-sized manufacturing companies, engineering firms, or designers. All could be new and high-margin markets for resellers who are willing to invest in the training and research required to be successful.
Costs Dropping, Performance Rising for Mainstream Desktop Systems
If you’ve followed the stocks of public 3D printing companies, you know that 2015 has not been kind to them. A key reason is that sales of mainstream desktop systems have declined, and that is in part due to customers knowing that cheaper, faster, and more capable systems will soon be available. Why buy something that might already be obsolete?
Much of the improvement is coming from OEMs just getting better at refining their products. Every new generation from the leading OEMs seems to be a vast improvement over the previous one. New technologies are also accelerating the evolution of 3D printing. Carbon3D’s CLIP (Continuous Liquid Interface Production) technology claims to be up to 100 times faster than other liquid-based technologies. HP’s first 3D printer will debut in 2016, and it reportedly offers huge performance benefits. While not a desktop unit, it has reportedly caused some companies to hold off 3D printing purchases until they can see the HP system in action.
How the Carbon3D CLIP technology works.
I expect much of the uncertainty over desktop 3D printer performance to clear up in 2016. Resellers thinking about taking a risk on an upstart making big performance claims need to closely evaluate the hardware, but also look at the strength of the company. Carbon3D, for example, has attracted significant investment, including $10 million from Autodesk, making it a safer bet. On the other hand, a Kickstarter-funded company is likely more risky even if the technology and products are solid.
Increased Specialization, Especially in Healthcare
The 3D printing industry is as varied as the markets it serves. A significant story of 2015 has been the development of 3D printers highly specialized for a specific application. One of the few bright spots that both 3D Systems and Stratasys reported were the sales of mid-range 3D systems designed for dental and healthcare applications. Expect even more specialization to occur in 2016.
Much of this specialization will happen in healthcare, which is one of the fastest adopters of 3D printing. It’s not surprising if you think about it. Almost everything your dentist or doctor does for you that requires the manufacture of an item will be highly customized to you—crowns, prosthetics, bone/joint replacement, and so on. 3D printing excels at creating custom, often complicated objects faster and at lower cost than traditional manufacturing.
Some analysts are predicting that most dental and medical offices will have 3D printers in house within a few years. That’s a big opportunity for resellers. If you currently sell hardcopy systems and services to healthcare businesses, ask what they are doing with 3D printing. You’ll find that it is at least on their radar.
Final Note: Expect to Be Surprised
Not a month went by in 2015 when I wasn’t surprised by a new development in the 3D printing industry—Carbon3D’s CLIP, low-cost SLS, 3D-printed electronics, and cars built entirely using 3D to name a few. Every time, it sets new expectations for the industry, and evolving expectations will continue in 2016. For an analyst like me, that’s exciting. A reseller might find it maddening, but with change there is always opportunity for those who can anticipate and adapt.
