Following on from our last Blog, putting to bed some of the more exaggerated claims about the potential with 3D Printing, we wanted to take this opportunity to put to bed some of the myths around price.
For those who follow us on Twitter (@frippdesign), you will see we, recently, engaged in an interesting discussion with a major vendor of full colour 3D Printing on the costs of 3D Printing. The claim made was that their technology could make a part for only $5, which we accept is true. But what they are, potentially, implying is ‘look how cheap it is to 3D Print full colour’. This is a piece of ‘marketing speech’ that many vendors put out about 3D Printing…if only it was true!
The very same Vendor, making this claim, eventually conceded that their 3D Printer costs $47,000, however they did state that their Total Ownership Cost (TOC) is lower than comparative technologies and, in this respect, there is some truth in what they say. However it is still a long way from being able to make a claim that it costs only $5 to 3D Print a part.
So let’s look into what the likely TOC is and the implications in buying a 3D Printer using the above as an example. The key factors to take into consideration are:
When buying capital equipment, financiers will normally depreciate the asset over a 5 year period. This represents depreciation of $9,400/annum on a piece of capital equipment costing $47,000.
2. Running Costs
As a company that operates three 3D Printers ourselves, 3D Printers do consume consumables (by this we mean things like Print Heads; not the materials used for Printing the model). It is difficult for us to assign a cost to this, but we will be generous and say the Printer consumes $200 of consumables per annum (note, for Laser based sintering machines, the ‘print head’ is a laser, replacing these runs into $1,000s but the 3D Printers do cost $100,000s to buy…and to be fair to these vendors we have not, yet, seen them claim you can 3D Print a model in metal for $5!)
3. Operating Costs
To run such a machine requires an operator. Accepting that operating a 3D Printer is not an intensive task, there is still a cost. We would assume that an operator is likely to be a 3D designer and the designer might spend 5% of their working week operating/monitoring the printer. Assuming a salary of $40,000, this represents an annual cost of $2,000. This does not include any costs incurred in fixing the 3D Print file to make it compatible with the 3D Print technology to be used, but we are assuming this would be absorbed in the 5% of designer time required to operate the printer.
4. Other Associated Costs
Although your designer would make the 3D Print file compatible with the 3D Printer, the designer will still need a PC and software to make any changes. For simplicity, we assume a cost of $1000 per annum to achieve this.
Total Cost Of Ownership
So taking the four costs together, then the annual ‘fixed’ costs of operating such a 3D Printer is in the order of $12,600.
In the Vendors claim, we have to assume that the $5 is the material cost for making the part.
So, to make 100 parts per annum, the actual cost/per part is $131 (12,600 divided by 100 plus 5)
To make 1000 parts per annum, the actual cost/per part is $17.60 (12,600 divided by 1000 plus 5)
To make 10,000 parts per annum, the actual cost/per part is $6.26 (12,600 divided by 10,000 plus 5), the reality is it would be higher as the 3D Printer will consume more consumables and might need maintenance because of the very high usage. However, for the purpose of this Blog, we will assume the machine can handle this level of use, maintenance free.
So, as with injection moulding, there comes a ‘tipping point’ where an investment of $47,000 in a 3D Printer looks viable (as does the investment in tooling makes sense for injection moulding)…but then you have to factor in another very important variable; the TIME it takes to make the part.
Let’s be generous that is takes an hour to print the part. At 10,000 units, this represents 10,000 hours or 417 days of continuous use (operating 24x7x365 days) i.e. making 10,000 parts per annum is very unlikely on a 3D Printer (in fact we know of no 3D Printer making $5 parts at this volume…we’d be very happy to be corrected on this though).
Even at 1000 parts, this works out at 125 working days (assuming a ‘single shift’ 8 hour day). This represents almost 6 months of a working year; again a very high utilisation of the 3D Printer. From our experience, 3D Printers operate in the 100-1000 prints per annum range, so the actual cost of ownership, of making a $5 part, is in the region of $131-$17.60 per 3D Print.
Even at this level, the costs still look attractive. The investment decision, as with any investment decision, has to be “Is there market capacity to be able to make a financial return on the investment (bearing in mind a bureau will need to add a profit margin to this cost)? Can we get the utilisation of the 3D Printer to justify the costs?”.
Although this Blog has been written in response to recent Twitter traffic, the principle applies to any 3D Print technology you are considering investing in.
Even at the entry level FDM 3D Printer level, you need to think about the Total Ownership Cost. We did buy an entry level FDM Printer and quickly rejected it because of the inherent low resolution and quality you get from a FDM machine costing a few $100. A great hobbyist product…but not something you would consider for making professional standard models (bear in mind you can get very high resolution FDM machines, but they cost significantly more than $47,000 to buy).
We are great advocates of 3D Print. In 2005, our co-founder, Tom Fripp, did his Masters in developing a method for manufacturing custom medical casts for his Masters. But when vendors over hype their capability, it impacts on our ability to sell our services.
We operate at the sharp end of 3D Printing and it is our job to set customer expectations at the correct level. 3D Printing offers many benefits, but lets make them realistic…please?
Note: The figures quoted in this Blog are for reference purposes only. The actual TOC will vary dependent upon the circumstances you will operate your 3D Printer. The figures quoted are theoretical and are provided to contextualise this Blog.