


The Production Dilemma:
In-House vs. External
Parts Manufacturing
Decision factors for your metal Additive Manufacturing strategy
This guide was developed in partnership with the experts at AMPOWER

Additive Manufacturing (AM) applications span the entire value chain, encompassing prototyping, tooling, and end parts, including spare parts. In the realm of Metal AM, end parts currently dominate, especially in highend industries such as Aerospace and Medical. As companies consider integrating AM into their manufacturing processes, they inevitably need to decide between bringing additional capabilities in-house or working with external partners. In recent years, various strategies have emerged, and no clear market tendency is evident. Numerous factors must be carefully weighed, and determining the optimal strategy is often complex. Some companies opt for hybrid approaches, maintaining limited in-house capacity for development and qualification and outsourcing serial production to external manufacturing suppliers while others choose to rely entirely on qualified external suppliers. This paper aims to provide users with a comprehensive guideline, addressing the key considerations involved in deciding between in-house and external Additive Manufacturing capacities.​​
Matthias Schmidt-Lehr
Managing Partner of AMPOWER

The world of metal additive manufacturing is in constant flux, with technologies advancing at an unprecedented pace. As a business leader, you face critical decisions: Are you prototyping, or are you looking for serial production? What additive technology is best for your part? What is your financial and IP risk tolerance? When you’re ready for serial parts production, the choice between purchasing a printer and developing your own in-house expertise versus collaborating with an external partner introduces an additional layer of complexity to your decision making. To help you navigate this complexity, we partnered with AMPOWER, the leading strategy consultancy and thought leader in the field of industrial Additive Manufacturing to create this guide. In this, AMPOWER provides a framework and unbiased insights to help you identify and evaluate the key criteria you need to consider for the build versus buy decision for your company, your part and your risk tolerance.
James DeMuth Co-Founder and CEO of Seurat Technologies
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5 decision factors to consider
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This guide explores 5 key decision factors to help you decide which process is best for your part(s).
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In-house Additive Manufacturing decision-making summary
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Pros | Cons |
|---|---|
Lower hurdles for design changes | No external know-how and collaboration may hinder good solutions |
Low supply chain interruption risk | High risk on ROI and difficult to plan total cost of ownership upfront |
High control over quality | Supply chain risk in case of machine failure |
High degree of IP protection | Low flexibility in terms of manufacturing volume, technology choice and material |
High internal know-how | High overhead cost |
Fast lead time, assuming available capacity | High upfront investment in equipment, personnel and associated risks |
External Additive Manufacturing decision-making summary
Pros | Cons |
|---|---|
Ability to access a wider range of manufacturing and post-processing capabilities without extensive investment. | Potential supplier switching costs |
Potential benefits and knowledge transfer from AM supplier expertise | For lower volume production, costs may be higher |
Plannable cost predictions with predictable ROI | Supplier management, ramp up and partnership required |
Transfers inevitable technology obsolescence risk to external partner | Supplier qualification know-how needed |
Scalable manufacturing capacity | Difficult to build internal technology know-how |
Low upfront investment and low associated risk | Potential IP risk |