“Stock or Print? Impact of 3D Printing on Spare Parts Logistics” by Professor Jing-Sheng Jeannette Song
Professor Jing-Sheng Jeannette Song
The Fuqua School of Business
We present a general framework to analyze and quantify the impact of 3D printing on spare parts logistics. We consider multiple parts facing stochastic demands. To minimize long-run average system cost, our model determines which parts should be printed and which should be stocked and the corresponding base-stock levels. When a demand for a stocked part encounters a stockout, it can either be backlogged or overflowed to the 3D printer. We derive various structural properties and characterize the optimal policy for several special systems, which lead to efficient near-optimal heuristic solutions for the general system. We demonstrate that adopting 3D technology can yield significant cost savings and this impact increases in part variety. Also, “a little flexibility goes a long way” in the sense that allowing both the stock and print options can substantially slash system inventory and cost, while the utilization of the 3D printer is surprisingly low.