Sunday, August 28, 2011

The End Of Manufacturing (or why Amazon Stock is still a great buy)

I know a lot of folks have been keeping an eye on MakerBots and 3D printers with the idea that some day you might stop buying anything but raw materials and have those build what you need when you need it - the only additional cost being for the blueprints. However I think the reason you don't see those catching on is not only because of the limitation of the current devices, but also that having stockpiles of every material you might need to have could be as costly or more so than paying someone else to handle it.

What I think is very likely, and probably less than five years away now, is that a large company that mainly handles sales and distribution like Amazon would keep industrial versions of those machines at each of their distribution centers, and then simply build the items when you order them. That allows them to cut down on waste and storage space, and they can even build the items in the box they will ship them to you in (exact form filling foam could reduce packaging costs and minimize damage). For Amazon this also means that inventory issues of overstocking and such almost completely go away.

So, if you're worried about your job going overseas, I think soon that won't be an issue. Because even cheap labor won't be cheap enough to compete with this model. If you invest in stocks, you may want to plan accordingly :-)



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