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Custom Manufacturing Supply Chain Moves Online

Supplier: ManufactureLink
12 May, 2006

The manufacturing industry as a whole is looking more and more to the internet to improve the efficiency of their sourcing and supply activities. Innovative online solutions like ManufactureLink are helping increase this trend.

The internet has stamped a seismic, indelible imprint on Australia’s manufacturing industry, making communications between engineers and manufacturers from anywhere around the globe faster and easier. These days we have email which allows us to exchange messages, drawings and documents in a matter of seconds. We have websites which allow us to browse a company’s capabilities and catalogues, purchase parts and materials, find specification, download 3D models of components, and locate almost any piece of information imaginable to help engineers with their designs. We now also have the new breed of purpose-built internet marketplaces such as Australia’s own ManufactureLink – a system which is consolidating and enhancing these capabilities to enable the sourcing of custom manufacturing.

So how have Australian manufacturing companies fared thus far in utilising the internet for their business activities?  Australia’s uptake has been slow, but is growing rapidly. A recent study by BuddeComm showed that 70% of businesses have a broadband connection, but how are they using it? The Australian Industry Group, in its quarterly manufacturing survey, produces statistics on internet use by manufacturing businesses and publishes their ebusiness intensity index. In the December, 2005 results the companies surveyed said that 13% of their sales, 13.2% of their purchases, 17.1% of their promotions, and 41.7% of their communications were carried out using the internet. The ebusiness intensity index has seen a steady rise from 16.1% in June, 2004 to 21.5% in December 2005. Even though our ebusiness intensity is not yet as high as it could be, these figures already represent a significant portion of manufacturing business being transacted over the internet.

With all the speed and efficiency the internet has to offer, engineers are increasingly turning to the internet as their first port of call when sourcing custom manufacturing. As such, the death nell is being sounded for the traditional phone and fax methods. But, are the newer methods of using search engines and internet directories the most cost effective and efficient solutions? As anyone who has sourced custom manufacturing knows, even with these new methods of communication, the engineer must still manually complete the sourcing process of locating suppliers, sending out RFQs, then assessing each supplier and their submission. It still takes a great deal of time and resources to source even a simple part. The process is not helped by the fact that the custom manufacturing network in Australia is a fragmented one, with no central contact point to locate suitable capabilities.

The problems posed in the sourcing of custom manufacturing are being addressed here in Australia by ManufactureLink – an Australian initiative to develop online sourcing software and a manufacturing network specifically for the custom manufacturing industry. ManufactureLink uses its technology to intelligently connect engineers and sourcing professionals (buyers) with suppliers of custom manufacturing having the exact expertise they need. Their fully automated software technology securely facilitates the complete Request For Quote (RFQ) process, including supplier discovery, Non Disclosure Agreement (NDA) handling, engineering data exchange, change history, collaboration, quoting, reputation assessment, analysis, job awarding and project management processes, while requiring no special software or training.

ManufactureLink’s network supports hundreds of manufacturing processes including machining, casting, forging, metal stamping, moulding, fabrication, sheetmetal, rapid prototyping, laser cutting, sintering and many more. Buyers can utilise their existing supplier relationships, or quickly submit RFQs to multiple suppliers having the exact expertise, industry experience and accreditations they need – at once. Suppliers receive daily emails with opportunities to quote matching their capabilities.

George Pofandt, Managing Director of ManufactureLink says, “By bringing the custom manufacturing community together online in one complete, efficient network, our systems provide a faster, easier and more cost effective solution for the custom component sourcing process than conventional phone, fax and email methods.”

ManufactureLink’s initiative has found huge support from industry in general, as well as from the key industry associations. “This online system represents a real step forward for our industry, and addresses the needs and challenges of Australia’s manufacturers,” said Shane Infanti, CEO of AMTIL. “Our members and the Australian precision manufacturing industry in general stand to benefit considerably from the increased efficiency offered by the system, and its ability to bring together manufacturers in an online collaborative environment.”
Bob Lundie-Jenkins, CEO of Austool said, “ManufactureLink’s system will provide Australian manufacturers with the tools to improve their competitiveness on the global stage, and we applaud their efforts and their innovation.”

Internet marketplaces such as ManufactureLink represent the new breed of internet based ebusiness applications that are making huge strides in improving business communication efficiency & reducing the costs of B2B transactions. Purpose-built systems like ManufactureLink offer the advantage of incorporating tools & functions to automate many of the traditional time-consuming tasks engineers & manufacturers face every day. These systems are designed to replicate the traditional business methods, but in an efficient, online environment. Combined with simplicity of use & low cost, systems like ManufactureLink will encourage even greater adoption of the internet as the primary communication, purchasing & marketing tool of manufacturing businesses.

But are Australian businesses really ready to increase their use of the internet in their day-to-day company operations? It would seem so. As internet connections increase in speed, & drop in price, the manufacturing industry’s uptake of ebusiness is on the increase. The annual IBM e-readiness rankings saw Australia climb to 10th in 2005, up from 12th in 2004, which puts Australia ahead of the likes of Singapore, Germany and Japan, & only a few places behind the USA. As Australia’s telecos move to upgrade our network to better suit high speed data transfer, & better, local ebusiness applications are developed, Australia’s e-readiness will continue to increase. Greater use of the internet to streamline manufacturing processes promises to increase business efficiency & productivity for our manufacturers, & enhance the global competitiveness of Australia’s manufacturing industry.