Thursday, June 24, 2010
Low cost custom plastic parts
If you haven't read Chris Anderson's theory about the Long Tail of markets yet, the theory is that products in low demand or that have a low sales volume can collectively make up a market share that rivals or exceeds the relatively few current bestsellers and blockbusters, if the store or distribution channel is large enough. The Long Tail is the potential market and the manufacturing, distribution and sales channel opportunities created by the Internet often enable businesses to tap that market successfully.
What does the Long Tail theory have to do with the MakerBot? Most of the case studies with respect to the Long Tail are related to distribution channels. However, the MakerBot (or other low cost fabrication machines) enable individuals to manufacture products in extremely low volumes with decent margins. An example is a custom cylindrical bushing that I was asked to manufacture on my MakerBot. The price to machine this bushing out of ABS plastic was quoted around $225 per piece. Needless to say, the machined price for the part would be prohibitive for the everyday person. However, the price for the part off of the MakerBot will probably be a tenth of the machined version.
The low cost of the custom plastic part will enable those potential buyers at the end of the "tail" to participate in the marketplace. As the sum of all those buyers is greater than the few, large buyers currently in the market, the actual sales opportunity is tremendous.
The question now is how to tap into that market which is not currently being served and may not even know that they have options.