WHEN DOES IT MAKE SENSE TO BRING AM IN-HOUSE?
Interview: Thomas Masuch; Grafics and Photos: Ampower
When getting into Additive Manufacturing, midsize companies in particular often face a major decision: Should we buy our own machine, or work with a service provider? Dr. Maximilian Munsch, a partner in the Hamburg-based consulting firm Ampower, has come up with some insightful answers in an extensive study of the AM service provider market in Germany, Austria, and Switzerland.
Mr. Munsch, your market study involved surveying over 50 service providers (that have more than 120 AM systems at their disposal) and comparing their offerings. What were your main findings?
MUNSCH: One thing we found was that the price of additive services varies a great deal in metals. For printed aluminum, for example, you can pay between €3 and €10 per cubic centimeter. What‘s surprising is that it does not depend on whether the vendor is a start-up or a more established company; you see big price differences among the more prominent vendors, as well. Meanwhile, there’s also no difference in price variance between requests involving series production and those for prototypes.
Don’t customers compare vendors’ prices?
MUNSCH: No, it doesn’t seem like they take a good look around on the market when it comes to price. In a lot of cases, there are also very close relationships between specific customers and vendors that aren‘t based on price. At the same time, we’ve seen that the market is still in the process of finding itself.
»Having equipment in-house thus offers the chance to build up internal expertise.«
What conclusions does this offer to user companies, particularly small and medium sized businesses?
MUNSCH: Well, the first insight is that getting offers from several vendors can definitely be worth the effort. This also enables a company to get a general idea of the current market prices and determine whether in-house production makes sense for specific applications and components.
What answers do you have for companies facing a decision like this?
MUNSCH: The make-or-buy decision depends primarily on the volume of parts you‘re looking to produce every year, of course. With aluminum (AlSi10Mg), you break even at around 125 kilograms per year; with stainless steel (316L), it’s 420 kilograms. In our view, aluminum is the most attractive option for those getting started in AM. The market prices on stainless steel, on the other hand, are so low relative to the cost of production that an inhouse investment hardly makes sense right now.
Could you give us a bit more background on that aspect?
MUNSCH: AM operations with aluminum require more expensive equipment and a great deal more expertise. In contrast, it’s possible to manufacture high-quality stainless steel using simpler, older machines. These production machines are often already amortized, which enables the respective companies to offer competitive prices on the market.
Is it possible to answer the make-or-buy question based on price?
MUNSCH: When you‘re establishing a foundation for AM, you also have to take other aspects into account. Along with infrastructure for the overall process, highly qualified employees are a key factor. The current shortage of specialists in this field in particular can present a real challenge to small and midsize enterprises. Having equipment in-house however offers the chance to build up internal expertise, as well.
You and Ampower just recently entered the market. What are your current goals?
MUNSCH: We’ve been around since early 2017, and we’re one of the few truly independent consulting firms specializing in the industrial application of AM. Along with our partners, we‘ve actually been dealing with qualified Additive Manufacturing in various industries for many years. We now advise our clients on investment decisions and manufacturing solutions, and also offer assistance in gathering internal expertise and optimizing additive components and processes. Besides putting all the experience we’ve amassed in laser-based processes at our customers’ disposal, we also provide all the help they need in implementing electron-beam technology.
In terms of its target customers, your company focuses mainly on SMEs. Why is that?
MUNSCH: Our customers also include a number of larger corporations, but the SME market is where we see the actual demand for our consulting services. For corporations, the decision to get involved in AM is typically a strategic one – which they then make a dedicated effort to see through. That means they invest in their own AM center and hire the specialists they need, which enables them to build up both corresponding knowledge and a cutting-edge reputation. Meanwhile, SMEs that have been working in conventional production see their first steps in Additive Manufacturing as an investment that has to make financial sense. Since we also know the market and its prices on top of our technical experience in AM, we‘re in a position to provide comprehensive support.
Mr. Munsch, thank you for taking the time to talk to us.