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On-Demand Manufacturing – a new standard

By Justin Ray, Sr. Sales Engineer

“Standards should not be forced from above but rather set by the production workers themselves.”

Taiichi Ohno, considered universally as the creator of the Toyota Production System, which inspired Lean Manufacturing in the United States, foresaw the impact a worker could have on standards and procedures within a manufacturing facility. And now, consumers are gaining that same influential power.

U.S. manufacturing has many dictating principles that are necessary to evaluate feasibility: market, labor force, real estate, supply chain stability, resources, and now; consumer trends following the impact of a global pandemic. Consumers are accustomed to the e-commerce model of items arriving under 48 hours to our doorsteps, all without shipping costs. But today, new product options are becoming available, including influencing designs for a custom product, and all still within the two-day window!

Just as the worker drives production, consumers have driven the need for a modern style of manufacturing. Enter On-Demand-Manufacturing (ODM), an innovative way of creating products with several key differentiators: limited or no prebuilding of stocked parts, ability to build millions of SKUs at any time, swift turn around delivery time to customer, and the ability to re-shore manufacturing jobs. ODM, put simply, is the process where goods are produced when needed, and in the required quantities.

ODM market is expected to reach about $112 billion by 2024, growing at an astounding 19.8 percent annually, according to MarketWatch.

Manufacturing, in the traditional sense, requires large buildings with the ability to pre-build and store mass amounts of products until they are ready for consumption. Many companies employing this model, often in response to labor and real estate costs, choose to relocate their facilities off-shore. In our experience with ODM, the U.S. labor force has the skilled labor for a streamlined operation consistent with On-Demand production, and consumers won’t have to wait for overseas production.

From a business perspective, cost reduction in storage and inventory management is a major benefit, often seeing a much smaller and more efficient supply chain. Given that product is created at the point of origin and at the time of need, forecasting order volumes and new product trends is effectively gone. In the same manner, overproduction and waste is also drastically reduced. Coupled with the reduction in necessary building square footage for warehousing and storage, a company’s environmental footprint can be drastically minimized.

So, which business sectors can benefit most by implementing an ODM model?

Most commonly, ODM is employed in home goods, apparel, books, and any customized product or industry. These markets are known for their vast amount of SKU diversity, constant change in popular trends, and ever-increasing e-commerce demands. S&H Systems has provided system integration for all of these markets, and we have increased our expertise in processes, functions, networks, and systems that are unique to this model. Most importantly, S&H Systems understands how automation can turn an already efficient concept into a streamlined and high throughput production system.

In the apparel industry the most common ODM use is direct-to-garment printing. Most often companies employ this as a custom print or logo onto a t-shirt. However, modernization in the fabric printing process has allowed for an even more customized processes. Instead of printing directly to a finished garment, many companies are now electing to move further upstream in the manufacturing process and printing directly to fabric. Most modern printers can now print to wool, synthetic, woven, knitted, and blended fabrics. These fabrics, now no longer confined to garments, can be utilized for home décor, upholstery, DIY materials, and custom clothing forms.

Surprisingly, the apparel and book manufacturing processes are quite similar in nature. Page or fabric, once printed and cut to size appropriately, is then traditionally sewn via a predetermined pattern. Whether machine or operator, pages are bound, and fabric is seamed, and a product is made. A typical ODM style facility, regardless of the products they make or market they serve, often have a similar conceptual flow overall. S&H Systems will customize the final solution to the client and their needs, but our industry experience has allowed us to develop a baseline for the design.

Most systems start with storage (whether it’s static racking or shelving), an AS/RS, a Goods-to-Person system, or a fabric roll system. The raw materials are typically transported by manual or automated means to a print/cutting operation. Often, these newly modified materials are then placed into a tote for ease of conveyance and later consideration for parts and order consolidation. This is where S&H Systems tends to bring our most value as a seasoned integration partner in the ODM space, as the process starts to resemble a manufacturing line, but with more software driven product movement. In lieu of traditional conveyance sortation, we often utilize AMRs to provide direct routing from many inputs to many workstations. This decreases the transportation and necessary recirculation for products to arrive at their desired location, and limits footprint on the factory floor usually reserved for transportation.

S&H Systems also provides automation to support the packing and subsequent shipping operation. Often order consolidation is required – traditionally a Put-To-Light solution for end of line operators to allow for parts and package consolidation for final pack out. This end-to-end solution allows for many Full-Time-Equivalents to be reallocated, along with drastically increased throughput.

On-Demand-Manufacturing is becoming more prevalent, and S&H Systems has the experience to help you design, build and integrate your custom solution.