3D Printing Straighter Smiles
“Align Technology disrupted the orthodontic industry by creating a digital approach to straightening teeth that makes treatment possible for more people than ever. None of what we have been able to achieve would be possible without 3D printing technology”
– Srini Kaza, vice president, product innovation, Align Technology (1)
Additive manufacturing (AM) is the cornerstone of Align Technology (Align) production operations. Creators of Invisalign, a clear aligner orthodontic treatment for malocclusion, Align is pioneering the mass use of AM with “the world’s largest 3D printing operation” (2) to revolutionize the dental industry.
Traditionally, clear aligners were fabricated using individually-casted teeth molds. Orthodontist would manually alter these molds for each phase of the treatment, making it a time-consuming and labor-intensive process. Plastic thermoforming machines would then create the aligners for the up to 48 molds needed for a treatment.
Despite the fact that the treatment itself is not new, Align’s innovation comes from its production process. It utilizes stereolithography (SLA), a 3D printing method where a UV laser shines through a photo-sensitive liquid resin solidifying it to a desired shape. This process creates all of the fully customized molds needed for a treatment in one print. These molds represent the anticipated position of a patient’s denture as the orthodontic treatment progresses. Using these molds, the aligners are then vacuum-formed utilizing an advanced, medical-grade, FDA-approved polymer. This makes it possible to create a year’s worth of aligners in a fraction of the time traditional methods allowed. Align’s facility produces more than 320,000 unique clear aligners per day. Utilizing 3D printing makes it possible to customize each mold without incurring additional costs. After the treatment plan is developed utilizing the company’s proprietary software, 3D printing 48 identical or highly customized molds has equal cost and takes equal time. This scalability occurs because there is no setup, tooling change or additional prep time required. Harnessing the power of 3D printing, the company has been able to grow their patient base six times since 2009.
Snapshot of Invisalign’s 3D printing production process (3)
To further develop their AM capabilities in the short-term, Align Technology developed a multi-year partnership with 3D Systems, pioneer of additive manufacturing technology, to develop customized solutions for their production line. One such example of customization is the addition of a unique patient ID to the device design that is then directly printed into the aligner to avoid confusion between different patient’s units. In September of this year, 3D systems announced Align has increased its investment in the AM company’s SLA technology that supports Invisalign maker’s expansion. As the company grows and enters new markets, it is scaling its operations by opening local production facilities in key regions like China, where the company anticipates a 15-20% annual growth rate.
Besides strategic alliances, material science is a big focus for the company as well in the medium term. Development of highly innovative materials in the future would allow the aligners to be printed directly (instead of having to 3D print the molds and then thermoform the aligners). Direct printing could further streamline Align’s operations and waste from all the sacrificial molds currently produced.
Invisalign’s massive market potential is quickly attracting competition. Currently, clear aligners represent 15% of the existing orthodontic market with Align holding an estimated 10% market share. In 2017, this amounted to close to $1.5 billion in revenue with a little over $230 million in profit. Large competitive players like ClearCorrect and a myriad of startups such as Candid Co and SmileClubDirect are establishing themselves in the clear orthodontics space, making the competitive landscape tougher. Combined with expiring patents, Align needs to strengthen its position. One way to do so would be to optimize their supply chain and reduce transportation costs by moving to a decentralized 3D printing process consisting of multiple mini production plants. This would also help reach international markets faster. Another way to cut down costs would be to improve the current 3D printing so the aligners are produced in one step. Currently, the gum line trim happens after thermoforming in a separate step. If aligners were to be printed to exact specs, a one-step production process would eliminate the need for material handling equipment and other factory capital costs.
So far, mastering AM has been one of Align’s main competitive advantages. As technology evolves, is the company prepared to adapt to newer methods? How would it respond if the competition adopts faster, more flexible, more cost-efficient or higher resolution technologies? Can it leverage the data of its over five million dental plans created to date to improve not only treatment creation but also the production process?
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References:
(1) Press release: 3D systems’ SLA 3D printers enable align technology’s unprecedented use of 3D printing in manufacturing. (2018, Sep 11). Dow Jones Institutional News Retrieved from http://search.proquest.com.ezp-prod1.hul.harvard.edu/docview/2102197772?accountid=11311
(2) Invisalign Clear Aligners | Invisalign. (n.d.). Retrieved from https://www.invisalign.com/
(3) Retrieved from https://3dprintingindustry.com/news/3d-printing-impact-on-dentistry-121284/
Sources:
Press release: 3D systems’ SLA 3D printers enable align technology’s unprecedented use of 3D printing in manufacturing. (2018, Sep 11). Dow Jones Institutional News Retrieved from http://search.proquest.com.ezp-prod1.hul.harvard.edu/docview/2102197772?accountid=11311
Align technology, inc. : Medical equipment – company profile, SWOT & financial report. (2014). (). London: Progressive Digital Media. Retrieved from Business Premium Collection Retrieved from http://search.proquest.com.ezp-prod1.hul.harvard.edu/docview/1553152365?accountid=11311
Zhang, F. (2014). Stereolithography and jetting based colorful 3D printing (Order No. 1561685). Available from ProQuest Dissertations & Theses Global. (1562508972). Retrieved from http://search.proquest.com.ezp-prod1.hul.harvard.edu/docview/1562508972?accountid=11311
Kieviet, A., & Alexander, S. M. (2015). Is your supply chain ready for additive manufacturing? Supply Chain Management Review, 19(3), 34-39. Retrieved from http://search.proquest.com.ezp-prod1.hul.harvard.edu/docview/1683366714?accountid=11311
McCue, TJ. “3D Printing Moves Align Technology Toward $1.3 Billion In Sales.” Forbes, Forbes Magazine, 14 Sept. 2017, www.forbes.com/sites/tjmccue/2017/09/14/3d-printing-moves-align-technology-toward-1-3-billion-in-sales/#5ca4276a5378
How 3D printing has changed dentistry, a billion dollar opportunity. (2018, October 19). Retrieved from https://3dprintingindustry.com/news/3d-printing-impact-on-dentistry-121284/
Tindera, M. (2018, May 3). Bracing For Competition? Cheaper Challengers Enter Invisalign’s $1.5 Billion Market. Retrieved from https://www.forbes.com/sites/michelatindera/2018/05/02/bracing-for-competition-cheaper-challengers-enter-invisaligns-1-5-billion-market/#4da5c57f2392
ALIGN TECHNOLOGY Q2 2018 CORPORATE FACT SHEET. (n.d.). Retrieved from https://www.aligntech.com/documents/Align%20Technology%20Corp%20Fact%20Sheet%202018%20Q2.pdf
Casablanca, Clinique Dentaire, director. YouTube. YouTube, YouTube, 7 Apr. 2014, www.youtube.com/watch?v=vsR0_wTR2a8&t=23s
I was surprised that clear aligners only represent 15% of the existing orthodontics market. What do you think it is keeping clear aligners from competing more directly with traditional braces? How do you think 3d printing will have to adapt to handle the more extreme cases of crooked teeth or do you think it has come as far as it will?
I was surprised as well at the small percentage of the market that clear aligners hold. Aside from the aesthetic appeal, it would seem that the product is superior to traditional fittings. I’m curious if there are specific factors that prevents orthodontists from switching from one method to another or whether the investment in manufacturing serves as a barrier to entry. Regardless, the technology seems to be an exciting option to bring brighter smiles to people all over the world. Nice work!
Given the increasing competition in the industry, I would like to propose that a long-term strategy for Align is to move upstream. Historically, Align’s competitive advantage was that it was one of the first to use 3D printing technology to increase ease of manufacturing and manufacturing capacity. Given that 3D printers are slowly becoming commoditized and other companies can now buy them, print molds, and then vacuum form aligners, it would seem Align can disrupt the status quo by becoming a specialized 3D printing technology house. The real promise of additive manufacturing is that it will allow for on-site manufacture of goods, so Align should be the company that enables dentists to print aligners at their office. Since 89% of Align’s revenue comes from the actual sale of Invisalign retainers[1], this would necessitate a change in business model. Perhaps the firm could give printers to dentists for free and charge for polymers, similar to the model employed by document printer vendors. Alternatively, the company could give away polymer and printers and sell an annual license to the software needed to operate the printer. Regardless of my ideas, though, Align has spent US$61mm, US$76mm, and US$98mm on R&D in 2015, 2016, and 2017, respectively[2], so it appears the company is aware of the challenges and possibilities it faces and plans to evolve with the times.
[1] Align Technology, 2017 Annual Report (San Jose: Align Technology, 2018), p. 2.
[2] Align Technology, 2017 Annual Report (San Jose: Align Technology, 2018), p. 58.
Interesting artcile. If its a superior product with lesser cost, a dentist who is in most cases the decision maker for which type of aligners to go for, might make more money per patient and should be incentivised to sell more of this less expensive but superior shape product. Are 15% market share more an indicator of the dentist’s reluctance to change in matters related to teeth where patients often dont want to experiment.
This is one of the more interesting, commercially viable uses for 3D printing that I’ve come across. It goes beyond proto-typing and actually solves a problem – efficiently manufacturing unique molds for individual patients. What concerns me about this advancement is that it will push the industry further into the aligners model. Currently, aligners are a sub-optimal way to straighten teeth. They are not as effective as arch-wires and do not have as lasting of an impact as installing a non-intrusive wire on the back of the teeth. Many might be okay with that – this is cosmetic dentistry and people, particularly millenials, may be satisfied with a slightly lower quality but more convenient solution. However, I worry that this will shift the consumer market to being more accepting towards lower dental standards. It’s as if we are leveraging technology to create a faster, but worse outcome. I’m not sure if that should be celebrated.
I actually believe that the budding consensus within the orthodontic community is that clear aligners are the optimal way to straighten teeth and improve a patients bite, leading to a higher quality of life in patients if they are treated correctly. The quality issues that arise from clear aligners stem from the fact that dentists are able to treat patients.
Orthodontics is a specialty that deals with the diagnosis, prevention and correction of malpositioned teeth and jaws. Orthodontic school is a highly competitive, three year program that requires dental school as a prerequisite. Orthodondtists are required to complete the written American Board of Orthodontics (ABO) exam to become certified and treat patients with arch wires. Invisalign, like other clear aligner brands, allow dentists to treat patients, which can lead to sub-optimal outcomes, potentially causing meaningful complications with not only a patient’s oral cosmetics, but also their bite and jaw positioning.
This is a very interesting application for additive manufacturing, especially given the level of customization that it provides. While Align may be losing market share to direct to consumer companies like SmileDirectClub, Align has the advantage of being closely tied with orthodontists and dentists. SmileDirectClub has invested heavily in marketing directly to consumers, including millenials, with little to no support provided by medical providers. In fact, the American Dental Association actually released a resolution strongly discouraging people from using “DIY orthodontics” like SmileDirectClub, due to the potential for harm when aligners are used incorrectly without orthodontic supervision (e.g., bite problems, enamel wear, even tooth loss) [1]. Align has the market advantage here since medical providers such as orthodontists and dentists are highly trusted and will be able to advise patients against using these direct to consumer brands since they have the potential to be dangerous. From this perspective, I think Align may be able to minimize their investment in advancing their materials and manufacturing processes if they can use their trusted position with medical providers to recommend their product over others. In this way, Align may be able to save by investing more in marketing and medical provider visibility rather than advancing their technology.
[1] Electronic Health Records, http://www.ada.org/en/publications/ada-news/2017-archive/november/ada-discourages-diy-orthodontics-through-resolution.
This was a very interesting article about a product that I had previously encountered, but not realized was an application of 3D printing. To address some of the previous comments, Invisalign can result in an optimal treatment outcome (i.e. equivalent to that of traditional braces), but it really depends on the orthodontic problem being fixed. In other words, it is not the ideal treatment for everyone, but can offer a more aesthetically pleasing solution for someone who wishes to avoid metal braces. Traditionally, that decision ultimately has rested in the hands of orthodontists when they offer various treatment options. To maintain their competitive advantage on startups like SmileDirectClub that are seeking to offer aligners at even lower costs, Align Technology should leverage the patient data that they have gathered to date to generate outcomes data. If they can prove that their technology is comparable to traditional braces in a majority of cases, they will remain differentiated from the startup aligner companies that are currently more limited in the cases they can treat.
Great article, Jane! I had never considered the possible applications of additive manufacturing in the dental industry. The technology’s value proposition aligns (pun-intended) very well this product. One point you brought up that really stuck out to me was the company’s focus on material science. If they are able to reach a point where aligners can be printed directly, do you think product pricing would be impacted? I sense that the price point is one of the biggest factors why clear aligners only make up 15% of the current market.
Great article. I do believe that Align can leverage its large set of data from dental plans. The company can look to the data to uncover trends in current usage of the technology and apply these findings to their production process. For example, these trends could aid in “decentralizing” the process in the article as you mentioned as a possible next step– Align will learn from its data where the product is utilized most often, and increase the number of machines in that specific area. Align can also use this data for marketing purposes to generate consumers, resulting in decreased fixed costs/unit produced.
Is this technology available in France already ?? I would love to see my orthodontic costs go down thanks to that !
Dreams aside, great article!
I totally share your point regarding maintaining a competitive advantage. I would argue that gaining market share can help them maintain competitive advantage because once orthodontists buy a product they don’t change easily, so by moving quickly and investing in its sales & marketing team Align Technology could benefit from its first mover advantage.
The second thing I would recommend is to invest in HR to maintain and/or ensure quality recruitment. Align needs to make sure it recruits the best people in the field to continue to innovate and maintain excellent product quality at an affordable price.
Melissa! It is available in France! As a user of Invisalign, and having compared the costs of different orthodontic treatments, I have to say that the technology has not reduced the prices of dental treatment. Instead, additive manufacturing has allowed the development of a product that is more convenient for patients, and hence Align (and dentists) are charging higher prices!
However, having used traditional (metallic) orthodontic treatments and Invisalign, I must admit that the accuracy of teeth movement is better achieved with the metallic treatment. Plus, the dentist sometimes has to manually adapt the aligners to react to slower than anticipated teeth movement. This suggest that the technology has room for improvement. I agree that using the data from patients (comparing predicted teeth movement to actual teeth movement) should be very useful for Align to improve the product.
I think the most interesting challenge for Align moving forward is how to differentiate within a mature market that has an increasing number of competitors and waning patent protection. One option could be to improve the economics for orthodontists. Often, patients who might be candidates for clear aligners are instead encouraged to get traditional braces, which tend to be more profitable for orthodontists. If Align can simplify the manufacturing process even further (down to one step, without the use of a mold), it seems possible that they could decentralize the manufacturing process entirely and allow orthodontists to manufacture trays in the office. In theory, this would be a positive development for all parties involved: it would help Align reduce manufacturing costs (they would only be responsible for the tray designs and providing manufacturing equipment to orthodontists) and retain market share, increase revenues for orthodontists, and make the entire process more efficient for patients.
God I wished this product existed 15 years ago….
I didnt knew anything about this topic and I learned a lot with your post. I really believe that it is the technology of the future. The market percentage of aligners is small right now. One of the reasons might be that aligners are much more expensive than traditional braces. But as the 3D-printing technoogy progress, aligners will be more affordable and take over the orthodontic industry.
I used Invisalign myself 3 years ago and I was very happy with the results and the price. I moved across the country and I told my orthodontist how are they going to get my mold for my retainers 5 years from now and she answered that since my model is saved I can just order them and they will ship them to me, no more new moldings to be taken.
I think that the company definitely has the advantage of being first. The 5 million people data that they have is a very big asset. I think they should use that data for their marketing (which areas should they target, which group age), for their product development improvements, etc. For example, back in the days I would think kids were the ones getting braces, but nowadays there are a lot of adults getting Invisalign. The company can find out what is the exact dynamic for this example and use it to their advantage. On the product development side they can use their learnings from the past years to improve their operations and become more cost efficient. The company has created relationships with their suppliers and they can use it to get materials at a cheaper price.
This post was a great introduction to a business whose core product relies on additive manufacturing. It is really interesting to see how Invisalign is disrupting the traditional orthodontics/braces market, but I wonder if their first mover advantage will prove to be sustainable over time. As new players move into the space, it seems their competitive advantage will need to come from decreasing costs, since the product (a clear plastic retainer) seems quite generic to the average customer.
Furthermore, with firms like SmileClubDirect where you can do everything directly from your home, Invisalign will increasingly face stiff competition from competitors aiming to further disrupt the space. As it stands, Invisalign has a host of dentists and orthodontists that vie to become “recommended” partners, a system that seems mutually beneficial as long as Invisalign is the most highly sought after clear retainer treatment option [1]. Nevertheless, the fact that they must rely on that channel to suggest the product and work with patients means that they expose themselves to channel risk that a company going direct to consumer can avoid. This will be an interesting space to watch in the future!
1. https://dentistryformadison.com/should-i-get-invisalign-from-a-dentist-or-orthodontist/
As a former Invisalign customer, I see another great potential value in this technology. Once customers has completed using Invisalign, they still need to use the last mode periodically to keep their teeth straight. I’ve had my last mold for years now and still wear them to bed several times a week. At this point, I have to wash my mold habitually to keep it sanitary. I wish that every year or so I could get a new copy of the mold to replace my current one. 3D printing could allow Invisalign to keep a model of my mold and produce a new annually at a low cost. I definitely would be willing to pay a little to get a new mold annually!
Thank you for sharing your thoughts on the impact additive manufacturing (AM) has had on the dental industry. Align’s use of 3D printing to create customized clear aligners for patients while improving the cumbersome method of braces installation for both orthodontists and patients has been revolutionary. This technology has arguably led to better customized braces without sacrificing time or labor efficiency on the part of the dental technicians. Align has shown that they are not fearful of breaking the mold and being the first mover. As a result, I believe that they will continue to adapt to newer methods to enhance the manufacturing of their braces and strive to reduce the cost to potential patients. They should and can leverage the historical and experimental data of their existing patient log to uncover the nuances of the market, improve design and uncover limitations of the technology to continue progressing regardless of the entrance of new competitors to the industry.
It is clear that Align will need to outcompete a growing number of competitors to maintain market leadership. However, one asset that Align has at this point in time is trust. With medical products – including dental – reputation and trust are critical to growing market share. As a first mover using 3D printing in the orthodontic market, I believe that Align has a clear advantage in brand trust. It should continue to leverage consumer trust in its brand, in addition to exploring how it can incorporate new technologies.
I found your question about responding to fast-moving competition to be especially interesting. I personally think the key actually lies outside the technology itself: In this market, a relationship with orthodontists seems key. If their technology is (relatively) comparable, relationships with orthodontists based on trust could be the key to maintaining key in a competitive market like this.
Further, it turns out that Align Technologies is actually an investor in SmileDirectClub. They purchased a ~20% stake a few years ago. Investing in a brand that is disrupting its core business is another way that Align can try to protect itself from innovation in the market.
Align’s stock price has declined nearly 50% in the past few months – from almost $400 in September to ~$250 today. Part of this decline comes from a perception that Align is not that different from its competitors – and as a result, its margins may face pressure in the future. What do you think Align can do to differentiate its products?
Interesting article regarding the future of orthodontics. Basically everyone these days has had some sort of braces. I’m led to believe braces may now even be covered by dental insurance. When you think of the brand name for clear orthodontics, you think Invisalign. Invisalign has a clear first mover advantage and brand name recognition in this space. Hence, this is partially why they’ve been able to be so successful.
But, while it has the advantage, Align is not being complacent. They’re spending millions on research and development, and the sheer magnitude of their R&D program implies that they will maintain their competitive edge as they develop new materials to print Invisalign trays in a single step. With regard to data, I think of it as inventing the lightbulb. By this point, they probably have a good idea of what doesn’t work. With tons of customer feedback, they can optimize the strength and durability of the product while decreasing the time required by the patient. Overall, I’m optimistic about the future of Align because they capitalized on the first mover advantage and are focusing their efforts on Kaizen.
As others have mentioned I really appreciated reading about this application of additive manufacturing, definitely one of the most interesting application methods I have come across. That said, as you allude to in your final queastions, I am inclined to think that their technology and production process might not be a large competitive advantage. As soon as competitors are able to use the technology after the patents expire and/or competitors develop similar or better technology, the only competitive advantage of Align will be that they were the first movers. Therefore I believe they need to use their first mover advantage to solidify their market position through developing better customer acquisition and distribution channels than their competitors, something that might actually create a lasting competitive advantage.
Additionally, I believe you are onto an even more interesting topic with your question related to their data. The major competitive benefit they currently have is to be able to produce faster and at a lower cost than competitors, significantly increasing adoption potential. If they can use the data to develop a better approach to treatment that can be proven to achieve results faster than competitors I believe they could have a major sustainable competitive advantage.
Very interesting article!
After reading through it and the comments, I have to agree with what most commenters have noticed; there seems to be no significant barriers to entry to this market, which leaves them on a weaker competitive positioning. If they are to sustain their leadership, they need to create a sustainable business model, that strives to lock in the customers with a great service.
It is incredible to see that teeth aligners can now be custom 3d printed for every patient! I also appreciate how Align has a strong relationship with orthodontists and the medical community, unlike other direct to consumer companies like SmileDirectClub. I think they can use this relationship to further strengthen their brand and position themselves as THE custom, high-quality, speedy solution for teeth alignment and even work with dental insurers to lower the costs of this process. Traditional braces cost thousands of dollars even with insurance, and based off this essay it seems like the production costs of Align should be far lower and thus this should be way more affordable for the masses. I’m interested to see how long this company can maintain its dominant market share!
Up to this point, it is clear that AM has been the key differentiator of the company and, presumably, competitors in the dental marketplace will catch up on innovation. Thus, I recommend the company invests heavily on research and development to further develop the AM capabilities. The first-mover advantage of the company can only be maintained if the management team focuses resources on mastering the AM capabilities and stays as a pioneer in the dental industry. Finally, because both processes information are synergistic I believe the company can lever the data created from treatment in order to improve the production process.
I LOVED this article! I myself am a big fan of Invisalign and am currently on a treatment plan with the SmileDirectClub. Would the Invsalign players you mentioned be competitors, or would they be potential customers and partners? From my understanding, 3D printing Invisalign aligners is patented technology that is unique to Align. I don’t think ClearCorrect, Candid Co and SmileClub actually 3D print their own aligners; some might not produce them at all. It might actually be more cost-effective for the Invisalign distributors like SmileDirectClub to purchase aligners from Align. Maybe Align could become the de-facto manufacturer for all Invisalign providers since it can win on price and speed due to its 3D printing technology and economies of scale.
I really believe that Invisalign, creators of Align, have always maintained a strong brand despite the increasing competition and relatively low barriers to entry. I think it is taking all the right steps by getting ahead of the curve on 3D printing. I believe if they can offer a better product at a lower price due to the cost adjustments using 3D printing, than the product will sell its self. The market for clear aligners is only growing and I think they are in a good position in terms of competition.
Given the success of SmileDirectClub and other B2C competitors, I do think that Align faces significant challenges in the near future. One advantage that they have is their significant data on existing customers, which they should leverage to build additional brand loyalty whether it be through follow-on straighteners in the years following original use, or keep-at-home products for when issues arise. I also think that Align will need to enter new business lines, utilizing their innovation that has allowed them to succeed to date. Dentures or prosthetic teeth seem to be the next most similar market that they can enter leveraging existing success to market to new customers. Given competitors are creating products quicker and marketing them at a lower cost, Align needs to act and think quickly about how they will stay afloat once their original customer base rolls off!
This unfortunately seems like a traditional case of a commodity product in which margins will slowly begin to erode as more and more competitors enter the space. Once Align becomes focused on cost cutting and is no longer focused on revenue upside, they will need to compete on price as their product becomes less and less differentiated. I would begin to look at other applications of the technology as opposed to defaulting to a cost-take out strategy, since those are difficult to win in the long run.
I love this post because it demonstrates a case where 3D printing drastically improves the user experience as opposed to just solving for an efficiency problem, which tends to be the focus of most takes on 3D printing. As someone that experienced the traditional molding process first hand, it as very uncomfortable and inconvenient experience to the extent that it was more so than wearing the liners!
this case of clear utility, efficient production and novel printing techniques represents a great marriage of megatrend and aplication.
Dear Jane,
Thank you for the interesting article on the application of 3D printing to dentistry
I would have liked to hear more about how the company designs the moulds. The revolution in 3D printing is also being accompanied by new methods to scan 3D objects. In this case it would allow you to easily build virtual 3D models of patients teeth (I assume this is the method they are using). After patients visit their clinics, Align could up-sell these scans to patients to help monitor dental decay and during normal dental checkups. Building up a large database of these scans would address a strategy you identified at the end of the article.
Align could also diversify into 3D printing other dental products that are designed specifically for each customer. I’m not a dental expert, but how about false teeth? It would require acquiring different 3D printing technology (for example Laser Powder Deposition for metal items), but many of the same skills that Align already has.
What a great application of 3D printing technology. Highly customised products are a natural fit for 3D printing, but high customisation normally comes at the expense of long lead times. I think your idea of establishing mini-factories around the world is a great way to reduce lead time, since the shipping times would be reduced. Also, eliminating the mould step would allow the lead time to be reduced. I imagine that such a product would be functionally similar across different competitors, so reducing lead time will result in some competitive advantage. Another way to get a competitive advantage is to make it more convenient for the customer to get his/her teeth scanned.
Thank you for the insightful post. The application of additive manufacturing employed by Align Technology serves as a great example of the impact that this megatrend can have. By replacing plastic thermoforming for 48 individual molds with an all-in-one production process focused on stereolithography, Align has significantly reduced labor costs and increased overall productivity within the clear aligner industry. Regarding the Company’s recent decision to scale operations by establishing production facilities near locations with high demand, I think this could prove detrimental to overall profitability. As you mentioned, Align’s success has brought forth a number of competitors, such as SmileDirectClub, which are undercutting Invisalign prices largely due to their direct-to-consumer model. Establishing additional production facilities would require significant capital expenditures which, given the current level of competition in the space, I do not believe that Align should incur. I expect that the delivery timing for molds is not a material factor in a customer’s decision to begin using clear aligners. As such, I suggest that Align partner with a well-regarded parcel company to deliver locally manufactured products to emerging regions.