Distributors Dish On 3-D Printing: Is It Worth It?

Major distributors have been scrambling over the past six months to add 3-D printing to their portfolios with mostly mixed sales results.

Fremont, Calif.-based Synnex and Santa Ana, Calif.-based Ingram Micro led the charge in 3-D printing last year. That was followed up in May of this year by Harrisburg, Pa.-based D&H Distributing and then Clearwater, Fla.-based Tech Data in June.

Ingram Micro has so far seen "good" demand developing for 3-D printers, according to Ryan Grant, Ingram Micro’s senior director of components and document imaging. Grant declined to give specific growth numbers and said the company is currently focused on the higher end of the consumer market as well as the lower to midsize business markets.

[Related: 3-D Printing: What's The Opportunity For The Channel? ]

"I would say that we're pleased with the results so far and they're going to continue to grow. I think it's really going to come down to partner adoption. There's a set of partners that are doing it but there's a lot more partners out there. ... there's plenty of opportunity to grow this business and do it from a partner perspective," Grant said. "The technology is only getting better, it's not going anywhere and end users are asking for it. There's not many channel partners servicing it today. To me, it's only upside."

Synnex Senior Vice President of Product Management TJ Trojan said that the low end of the market is open and competition is growing, but the higher end that the distributor caters to through its partnership with vendor 3-D Systems has much higher margins. There is a lot of opportunity in the market, he said, especially if VARs build service packages around them.

"Synnex sees 3-D print as an extension of our technology solutions strategy -- which basically is our high-value category and product focus area. Technology solutions stretch from AV to unified communications to high-value print strategies such as managed print, wide-format print and document management solutions," Trojan said. "Though 3-D print is significantly different than 2-D or transaction print, we do see this as adjacent to much of our print strategy. For instance, many of our new 3-D customer partners are already engaged with Synnex through our wide-format print team, focusing on the architectural, engineering and graphics vertical."

The other distributors CRN spoke to said that they are too new to the market to pull out specific growth numbers, but they have seen a lot of resellers reaching out to them intrigued by the technology.

"I don’t know if you’ve seen the growth rate of 3-D printing, but it’s a hot market right now. It's obviously been on our radar for a long time and we've had quite a few resellers reach out to us about it," said Tiffany Severance, Tech Data director of product marketing, systems and peripherals. "I think there's an untapped market out there as well for applications that customers haven’t even thought about."

With the programs being built from the ground up and all less than a year old, Ingram Micro's Grant said that the channel is still working to figure it all out -- distribution included.

"It's all new for the channel," Grant said. "I think overall, the thing is there's been a lot of buzz around 3-D printing. What's driven a lot of the buzz is that it's become more of a consumable technology. I would say the market is still in an education mode as to B2B."

NEXT: What's The Key To The 3D Printing Market? Verticals

The distributors CRN spoke with said they believe vertical markets are the key to success in 3-D printing, but their responses were varied on what vertical markets held the most opportunity.

"To be honest, that's the beauty of this technology, there really is no limitation to the application from a vertical market perspective," Grant said. "There really isn't limitation to partners reselling technology and I would say very few limitations on verticals."

Grant said he sees opportunities for 3-D printing in health care, dental, orthopedic surgery, education and commercial resellers. He said education and health care are the "low-hanging fruit today."

[Related: 3-D Printing: What's The Opportunity For The Channel? ]

For Tech Data, Severance said she sees the biggest opportunities for 3-D printing in health care and for resellers that can package it with Autodesk software.

Meanwhile, Synnex's Trojan said there are vertical opportunities in architecture, engineering, medical and dental, industrial and manufacturing and education.

Konica Minolta, a 3-D printing vendor, also sees opportunity in manufacturing, along with health care and other markets, according to Senior Vice President of Marketing Kevin Kern.

"The product is going to be driven by the vertical that it is going into," Grant said. "Not every single reseller is going to adopt the technology, that's just not going to happen. ... The verticals are really going to drive it. Like everything else, it's early going."

Not all distributors, however, are jumping in.

Global Convergence COO Joe Serra said the distributor hasn't brought on 3-D printing and doesn't see it as something all VARs need to have as part of their portfolio. Serra said that all new products fall into one of three categories for a VAR, and every time a VAR expands a portfolio they should evaluate whether it is material to results, relevant to results or irrelevant to results.

"Solution providers have to be very careful in picking their battles," Serra said. "Adopting something new is extremely difficult for a lot of solution providers. It's got to be meaningful and material to their business in order for them to take a look at it."

Ingram Micro's Grant agreed that while 3-D printing is compelling, it isn’t for all resellers.

"In terms of ability to go sell, any reseller can go sell it because there are so many applications. But I don't know that every partner will jump in and participate," Grant said.

Technology is outpacing the rate of reseller education and that's holding the market back, Grant said. The technology is constantly evolving, but resellers aren't necessarily up-to-date on how they should take it to market or if it is a good option for their clients.

Konica Minolta's Kern said the biggest factor holding the market back from a vendor perspective is materials. However, as material science continues to grow, Kern said he expects the market to have lots of areas it can grow into and become as "revolutionary" to the market as iTunes was to the music industry.

"I think the material science is going to be the key thing that determines where it goes," Kern said.

However, Synnex's Trojan said that he is continuing to see materials expand, which makes the market for 3-D printing even greater.

"Applications are almost unlimited from a creative and design perspective, and production options continue to expand with available materials ability to provide strength, flexibility, durability, heat resistance and biocompatibility," Trojan said. "[Synnex vendor partner] 3-D Systems currently has more than 100 material options, including plastic, nylon, metal, rubber, wax, composite, ceramic and even edible materials."

Ingram Micro's Grant said moving forward he expects prices to continue to be driven down, line cards to be augmented and services packages around the technology to continue to expand.

PUBLISHED JUNE 25, 2014