Providing Business, Tax, and Accounting Advice for 3D Printer Purchase Decisions



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3D-Printer-Purchase-Decisions New and improved 3D printing technologies are enabling a wide range of businesses to offer new products or reduce the costs of existing products.  Business advisors including accountants and tax professionals have an important role to play with the wide range of businesses that benefit from 3D printer purchases.  To assist business owners in making the decision to purchase a 3D printer, advisors need to ask the following fundamental questions.

  • Are final product custom deliveries delayed because of long lead times related to particular parts or components?
  • Can profits be increased by measurably reducing the cost of certain components or parts?
  • Could the business potentially benefit from beta testing new and improved products before making a major production process investment?

Product manufacturers use 3D printers for several reasons.  Some prefer to print vendor supplied parts that are otherwise unavailable because of long lead times or are simply too expensive.  Others use them to make highly engineered components or parts that either: 1. aren't suitable for regular production runs or 2. are custom or too complex to be created using traditional processes.  Designers use them as well, typically to enter markets with a product when they don’t have manufacturing infrastructure in place.  These users may obtain substantive benefits from 3D printer purchases.  Some of those benefits are listed below.  

Product Variation: 3D printing offers the ability to manufacture highly complex and custom products one at a time without modifying or purchasing additional equipment. Conversely, traditional manufacturing machinery is typically designed to produce homogenous products over and over again.
 
Material Variation: 3D printing offers a wider range of materials that can be substituted for one another when products or available materials change.

Reduced Cost-per-Unit: Mass production in traditional manufacturing is typically inefficient on a limited scale. With 3D printing, the cost per unit is stable even if a small number of products are produced.

Integration: 3D printers are relatively low cost.  They are also small; thus they save floor space and can be easily integrated into existing operations.  

Reduced Cost of Components: Some products and components are particularly expensive to purchase.  Smart manufacturers identify these products and often 3D print them for less.

3D Printer Tax Incentives

3D printer tax incentives include potential Section 179 equipment expensing, possible bonus deprecation, and R&D tax credits related to the 3D printer integration process. Many of these yearly tax incentives typically depend on the enactment of federal tax extenders, which typically have been available in recent years.

Choosing a Printer

Some websites offer reviews of 3D printers by previous purchasers.  For example,  3Dhubs.com has a 3D printer guide based on the reviews of over 2,200 verified 3D printer owners with over 1,600 collective years of experience.  They provide information on the following parameters; print quality, ease-of-use, build quality, reliability, failure rate, customer service, community, running expenses, openness, software and value.

Lease vs. Buy

During the 2014 year 3D printing industry sales have stalled in part because purchasers are anticipating new, lower cost, higher performing printers.  One technique that addresses concern over technology obsolescence is a short term lease arrangement or using a 3D printer service business.

Conclusion

Informed 3D printer purchasing advisors can help their clients enter new markets and reduce printer costs.  End users also benefit from tax incentives that may be available at the time of the purchase.

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Authors

Charles R Goulding Attorney/CPA, is the President of R&D Tax Savers.

Michael Wilshere is a Tax Analyst with R&D Tax Savers.