3D Systems have just launched www.cubify.com which is a direct competitor to Materialise’s http://i.materialise.com.
Both systems allow consumers to create & upload 3D Print files and get them printed.
Although we applaud both organisations desire to open up the market for 3D Printing, we do have some reservations about creating a B2C market for the technology at this stage.
For aesthetic models, we believe the opportunity might work; albeit the quality expectations vs costs, might put consumers off in the medium to long term. However, for consumers who want functional models, we do have concerns about product failure and the impact this might have on the consumer (3D Printing is after all, right now, a prototyping technology).
There are also lots of patents in the area of 3D data capture and printing too. So, whether your a patent attorney or litigation attorney, these could be prosperous times…we sincerely hope not and wish 3D Systems and Materialise well with both projects.
The issue of access to credit for SME businesses is topical at the moment so Fripp Design and Research would like to give our perspective on it.
A key reason why the banks got into so much trouble is that they allowed their gearing (debt to equity ratio) to get too high i.e. they lacked the asset coverage when things went wrong (and, hence relied on the tax payer to re balance their balance sheets to bail them out).
Quite rightly, the Government insisted they repaired their balance sheets, ensuring that their gearing ratios were kept within an affordable level (i.e. they could meet future liabilities) so the tax payers liability was removed.
One of the indirect consequences is access to credit, on risk acceptable terms, from the banks.
Our business could take on more debt to expand some of our projects more quickly, which would result in us paying more corporation tax (further down the road) and employing more people. However we choose not to because the banks have to (which is a little different from wanting to) take security on the loan (for the reasons described above). As we do not need to expand our business any quicker than we are and we do not want to take even greater risk through secured lending, we choose not to expand our business, more quickly, at this time; which means we are not employing more people and we will not be paying more tax.
We guess there are many other businesses similar to us too?
The Government have tried pumping money into the economy (through printing money calling it ‘quantitative easing’) but all that has happened is the money was bought by large corporates to add liquidity to their balance sheets (which we suspect is to build up cash reserves for future acquisitions) and did not find its way into the ‘real economy’.
However we believe there is an innovative solution to the Problem (which is what our business is all about).
The Government runs a great scheme for unsecured funding of businesses called the Enterprise Finance Guarantee Scheme, but the criteria for qualification is very tight. If the Government were to expand this scheme, relaxing some of the eligibility criteria regarding personal assets, then businesses, like ours (and we are sure thousands of others too), would be prepared to borrow to expand their business. This would create liquidity in the real economy and would help to achieve the Government’s objective of getting the economy moving.
The beauty of this is that the tax payer is not having to find real money. It is simply underwriting some of the risk to grow the economy. We’d certainly impose penalties on banks who end up lending to businesses that then, as a consequence, fail so they are incentivised to still lend on sound business principles; what we’re suggesting is relaxing the need for personal securities for the entire line of credit required.
Don’t get us wrong, the lending criteria should remain the same i.e. the need for the money has to be sound; what we are suggesting is the Government share some of the risk (with the business owners) once the lending criteria has been met. The businesses benefits through growth and expansion. The Government benefits from jobs, growth and improved corporation tax revenues (and for exporting businesses, improved balance of payments).