I do believe that in the short term, the Speedfactory is a clever marketing ploy that could attract a number of customers who are interested in the latest design and technology of footwear. In 2015 Adidas opened their first Speedfactory one hour outside of their German headquarters. [online] Available at: https://www.adidas-group.com/media/filer_public/a3/fb/a3fb7068-c556-4a24-8eea-cc00951a1061/2016_eng_gb.pdf [Accessed 10 Nov. 2018]. Adidas would only point to the â¬164 million (about $173 million at the time) it spent on R&D in 2016. The robots it uses may already be common in other industries, but they had to be adapted to put sneakers together. “In the one factory you create your rubber, and then the rubber is formed into a certain shape. The benefits of in-season development include: By 2020 Adidas estimates they will generate 50% of sales through speed-enabled channels, increasing their share of full-price sales by 20% . as you noted, Nike is taking similar measures). Co-created with runners. The Speedfactory’s main strength is to shorten the supply chain, and so the time to shops, to less than a week, perhaps even to a day, once the trainer design is complete. Automation has advantages beyond speed; it offers mechanized accuracy too. [online] Quartz. There are few concerns on the 3D printing process itself, with critics pointing out the fact that the molecules are not as tightly glued together and could cause injury and that the output/ or consistency of shoes produced for the same input can vary. Interesting article written with a great eye for detail! (That’s also where 3D printing helps: It lets Adidas simply print soles for prototypes and eliminate tooling, the costly and time-consuming step of building the metal mold used to make soles in conventional sneaker making.) Adidas says it had the expertise and commitment to innovation Adidas wanted in a partner to build its automated factory. During quality control checks, if there’s a problem, they can trace the part back to the machine that made it, and know what the settings were on the machine. Powell says the Speedfactories should help Adidas to adapt to this shortened cycle in ways that will matter even if they aren’t churning out tens of millions of sneakers a year. Made for city running. The rise of social media has led to a “see now, buy now culture”, where consumers are accustomed to instant gratification, driving demand for “fast fashion” products . Adidas is leveraging futuristic automation and additive manufacturing to lead the pack in fast footwear. Available at: https://www.mckinsey.com/industries/retail/our-insights/faster-fashion-how-to-shorten-the-apparel-calendar [Accessed 11 Nov. 2018]. Just as important, the Speedfactories will soon be able to rapidly replenish stores in Western Europe and the US. [online] Available at: https://www.digitaltrends.com/outdoors/adidas-futurecraft-4d-jan-18/ [Accessed 12 Nov. 2018]. The investment in Speedfactories is not an imminent threat to traditional sneaker manufacturing but is a critical R&D expense, instilling a culture of innovation.  From start to finish, it can take 60 days to make a shoe using this conventional process. One million pairs of sneakers is a small fraction of the roughly 360 million pairs of shoes (pdf, p. 69) Adidas’ suppliers produced for the company in 2016. Available at: https://www.logisticsbureau.com/traditional-to-fast-fashion-retail/ [Accessed 12 Nov. 2018]. [online] Logisticsbureau.com. [It] took off really at the beginning of 2012, and the trend was over by the middle of 2015. The first sneakers to come out of Speedfactory hit the market in September 2016.  Abraham, M. (2018). Today, it’s the site of a nondescript, white building bearing the name of Oechsler, the German firm Adidas partnered with to build it. (They shared the expense.) To me, the Speedfactories seem more than an expensive marketing ploy (or at least a rather ineffective one, since awareness on this concept is relatively low). More importantly, they will be able to over better customization at a larger scale. awesome designs you ask.. we customize it's not just a car it's a way of life tuning, custom, hot rods, bikes complete projects, car repair, custom garage tuning, hot rods, bikes, classics, lifestyle & parts shop on the 1st floor we understand all about your car It opens doors to creation of product completely unique to the fit and functional needs of consumers, through a combination of the craft of shoe making and cutting-edge technology. This raises a few questions: One commercially viable use for the factories is rapid prototyping and market testing.  Adidas AG (2016). Profiting from Personalization. The idea is in the name — it’s about speed and with adidas’ experimentation of sustainable materials as well as its zero stock and local production, the brand even gets brownie points in terms of eco-innovation. SpeedFactory LLC. This would provide job opportunities to high skilled operators and engineers. The company should build-out their speedfactories in targeted geographies while continuing to expand their reactive manufacturing processes, further reducing lead times. 2017 NIKE, INC. INVESTOR DAY. In 2016, Adidas launched SPEEDFACTORY pilot project in Germany, a smart manufacturing process via robotic automation that integrates the design and production process tailored to specific markets. And it isn’t alone. Adidas backpedals on robotic shoe production with Speedfactory closures. With intense competition and the consumer moving to fast fashion, this will give Adidas a huge boost over competition. Footwear and clothing brands frequently have their suppliers embed RFID tags in finished goods so that if they spot defects they know the factory responsible. Eventually, Adidas’s goal is to be able to make individually tailored shoes, where 3D printing may be indispensable again. “A lot of these processes donât exist [in sneaker manufacturing],” Manz says. Adidas’ Futurecraft 4D DLS Shoe Goes On Sale January 18 for $300 | Digital Trends. The adidas Speedfactory is a multi-phase project, which should bring manufacturing capacities back to Germany. Oechsler was instrumental in building the robots and production set up within the roughly 4,600-square-meter building (about 49,500 square feet), tasks beyond Adidas’ particular expertise. In fact the limited run of Futurecraft 4D shoes that you mentioned in your article was sold out within a short amount of time. Another potential impact that I could see is that this could be a driver to help bring back manufacturing back to western countries, as the process is highly automated. Inspired by London. Summit: Pathways to a Just Digital Future, Investigate how to address technological inequality, AI puts Moderna within striking distance of beating COVID-19, Dig into the totally digital biotech company, Adidas Speedfactory: Disrupting The Sneaker Manufacturing Process, Tala: Providing loans for those without a financial identity, https://baltimore.cbslocal.com/2016/06/28/under-armour-opens-lighthouse-innovation-center-in-baltimore/, https://www.theguardian.com/product-innovation-with-henkel/2018/oct/22/evolution-of-3d-printing-adidas-carbon-henkel-renishaw-additive-manufacturing. But the materials in those industries tend to be rigid or fairly uniform.  Yeung, Ho-Ting & Choi, Tsan-Ming & Chiu, Chun-Hung. Adidas sourced 97% of its footwear from Asia in 2016, according to the most recent numbers available from the company, and that’s where the bulk of production will stay for the foreseeable future. Because Speedfactory allows the company to swiftly experiment with new sneakers, Manz describes it as an “innovation platform.” Adidas doesn’t necessarily need to produce 50,000 of a single style and have an entire marketing and distribution plan in place 18 months ahead of time. Faster fashion: How to shorten the apparel calendar. Two years ago, when the company conceived of the idea for Speedfactory, the patch of land Adidas wanted to build on was a potato field. To answer your first and second questions, I believe that there is commercial viability in additive manufacturing for companies like Adidas and that this is not just a marketing ploy. Otherwise, all the work happens in Adidas’ factory, right here in Germany and now the US, where it recently opened a Speedfactory in Atlanta. Adidas is radically transforming customer experience with their SpeedFactory in Germany and more recently Atlanta, both of which use machine learning and data-driven design. While 3D printing is likely to replace traditional manufacturing techniques in the future, I think it has great value in cutting the lead time for launching new products at the moment. At the same time, I do strongly feel that taking a long term view and starting early to build such capabilities to remain competitive is extremely important. Great article ! In case you missed it, the Speedfactories were part of Adidas’ global strategy to decentralize manufacturing and distribute operations in the midst of recurring supply chain shortages. Right now, Speedfactory is focused on premium performance shoes like those. It makes Adidas dramatically faster and more flexible in producing shoes. In another place, the midsole and the bottom are combined,” explains Ulrich Steindorf, senior director of manufacturing at Adidas. The job profiles Adidas and Oechsler used for hiring were common in other industries, such as automotive manufacturing, where automation is common, but new to the sneaker world, Steindorf says. At present, the Speedfactory in Ansbach is only set up to make Boost soles. “Innovation has completely changed,” says Manz, who marked his 20th year at Adidas in November. Scaling Speedfactory isn’t just about building more of them either. This flexible model challenges the idea of centralised production and makes product close to where the consumer is. Technology moves so fast it’s hard to guess what even the next few years will look like. Depending on the shoe type and the volume of that product sold, it would be interesting to run a break-even analysis to see whether traditional manufacturing or additive manufacturing makes more sense. Want to learn more about digital transformation? You must be logged in to post a comment. The Company should also expand their partnership with Carbon, adding to the hype generated by the Futurecraft 4D release. Buy UltraBoost from adidas Here http://bit.ly/2lhL7vK Buy Speedfactory Boost http://bit.ly/2Kei7Pd Shop best sneaker deals of the week here! FT-86 SpeedFactory Bronze Ceramic Coated Catted UEL Header 2013+ FRS / BRZ / 86. Adidas had to create new ways for machines to handle its materials and solve other basic problems. Oechsler, which works in the automotive industry, helped with recruiting. That someone else is almost always in Asia, where it became the norm to outsource laborious manufacturing work in the 1980s, since labor costs are low and there’s now a massive infrastructure set up, particularly in China. If you can get an Adidas pair of shoes two times faster, or a Nike shoe that is two times better – what would the consumer choose? Of course, the success or failure of such a venture will ultimately be defined by Adidas’ ability to execute effectively and scale this investment across its operations. Though that number will probably be bigger still in 2018 when the Speedfactories finally hit full production volume. The SpeedFactory initiative began a few years back, and since then has totally revolutionized and rejuvenated the Adidas sneaker manufacturing process. A German company built a “Speedfactory” to produce sneakers in the most efficient way, “If we want to be faster and more flexible in doing what our athletes want and need, then we have to rethink the way we make products.”, “We wanted to create the factory of the future.”. The Speedfactories also enable the company to test new production methods and institute their findings across other facilities. “This should be representative of what all our factories are in five to 10 years from now.”. “We wanted to create the factory of the future,” Manz says. While domestic manufacturing in the United States has been generally more expensive, I believe the long-term trend will yield lower costs in domestic distribution and reduced inventory. In determining whether there is a path to commercial viability, Adidas needs to determine which type of sneakers additive manufacturing is most beneficial for and what percent of total volume those types of sneakers account for. Don't worry - as always, you can easily order exactly what you need from our website 24 hours a day, 7 days a week! But now experts believe the industry has reached an inflection point, spurred by the spread of e-commerce and social media, which have sped up fashion cycles and taught shoppers to expect instant access to a constant stream of new products. It’s messy and slow, needing time to dry, which is why Adidas prefers fusing pieces when it can. 10.1007/978-3-642-04313-0_21. Why has Adidas increased their R&D spend by over 35% to build state-of-the art sneaker manufacturing factories ? Additionally, a growing number of customers are pushing for customized products, creating a market for Mass Customization, the process of producing customized products for satisfying individuals with the efﬁciency of mass production . The new factories are just one piece of a bigger shift. A future with lower cost customization featuring nimble supply chains is surely a win for consumers, but I struggle to see how Adidas or any apparel company can maintain a competitive edge once additive manufacturing becomes commoditized. Compared to the months it can take to make a sneaker in the traditional supply chain, Speedfactory completes production in a matter of days. SpeedFactory Billet B-Series Timing Pointer B16 B18. Our primary mission at the SpeedFactory, is to provide a state of the art training facility while taking an active role in the health, fitness and self-confidence of the youth of Saline County. The midsole is created. “Itâs a different kind of joining process behind it where we just donât have a solution yet.” The infrastructure that already exists in Asia for creating these types of sneakers also just makes it more advantageous to produce them there. It’s a pioneering concept that concentrates the sneaker-production process in a single space, and in the market where the shoes are sold. Soon it will also add the “digital light synthesis” 3D-printing process developed by Carbon. Speed Factory Racing was formed by Lithuanian rally driver Dalius Steponavicius in 2008 with a target to help and prepare race drivers for endurance racing. Rather, I believe they are an adequate response to the market demand for speed you identified, and to competitors (i.e. Goldman Sachs mapped the correlation between supply chain lead times and like-for-like sales growth : This chart illustrates an inverse correlation, with fashion brands like Boohoo and Asos capitalizing on market demand. Sales@speedfactoryracing.net. (2010). Morgan Stanley estimates they could produce almost 20% of their sneakers at “more automated” factories by 2023. But Speedfactory is an attempt to bridge the void. With over 50 years of combined experience in modifying and racing Hondas, you can count on our record-setting team for validated performance solutions. It’s a pioneering concept that concentrates the sneaker-production process in a … These initiatives should bolster Adidas’ leadership position in the fast footwear category. Oechsler actually started in the mid-19th century as a maker of horn buttons, but now specializes in the decidedly more modern field of plastics injection molding. With a minimalist design, this German factory features robotic arms, multi-layered particle machines, laser cutting robots and 3D printers – no, this is not an electron particle laboratory, this is Adidas’ new “Speedfactory”, a factory designed to disrupt the sneaker supply chain. I would like to address the first and second questions that you posed above. Speed Factory Racing is an auto racing team based in Spain.. History. SPEED FACTORY OUR MISSION. But Adidas had to work hard to make it a reality. Like you mentioned, I believe the best use of the Speed Factory at the moment is rapid prototyping, which enables quick market testing. SKU: FT86CTDHDR-BRZ. For Adidas to remain innovative, the company must continue to invest in their Speedfactory project in the medium term. The Ansbach employees also tend to be workers of a very different sort. Adidas opened their second Speedfactory outside of Atlanta, GA.  Sprunk, E., Nike COO (2017). Speedfactory obviously enables us to have the conversation much closer to production, which is why in the same year that I get talking with somebody about the product, [I … “And that goes for the entire industry, Iâm not speaking just for Adidas.”. Adidas is abandoning its robot-staffed Speedfactories in Ansbach, Germany, and Atlanta, USA. Just the idea to build a factory in Germany was a bold move for Adidas. Love this topic and analysis! It encapsulates mass customisation, rapid response time and demonstrates how advancements in technology can truly benefit the consumer. “Adidas is at the cutting edge,” he says. There are 160 employees at the Ansbach location. Innovative Mass Customization in the Fashion Industry. Ships for free in the 48 states. It releases in London on October 26th, 2017. The innovations Adidas has since put in place largely convergein theSpeedfactory. “If you use an example of a Superstar or a Stan Smith, itâs a rubber outsole,” Steindorf says.  “‘Quietly, people were forging ahead’: the evolution of 3D printing.” The Guardian, 22 October 2018, https://www.theguardian.com/product-innovation-with-henkel/2018/oct/22/evolution-of-3d-printing-adidas-carbon-henkel-renishaw-additive-manufacturing. Precision CNC machined, these have a bright raw finish so that the pointer stands out against the black timing cover and crank pulley and is easy to read clearly. Adidas and its partners had to create new ways for the machines to handle its materials and solve other basic problems. [online] Available at: https://www.adidas-group.com/media/filer_public/a3/fb/a3fb7068-c556-4a24-8eea-cc00951a1061/2016_eng_gb.pdf [Accessed 10 Nov. 2018]. Pre-Season refers to predicting trends and building inventory while in-season refers to quickly reacting to trends, ensuring in-demand products are delivered just in time. Though still in its infancy, the Speedfactory project seems to be showing early signs of success. This sharing of best practices should reduce manufacturing times across the global footprint while reducing costs. As Speedfactory makes more and more shoes, Adidas will be able to continuously refine its processes, reducing the waste from parts that aren’t up to standard and ensure that it’s making a better final product. Like other sportswear brands, Adidas has traditionally relied on cheap manufacturing in Asia to keep production costs low. Adidas’ main competitor, Nike is in the process of near-shoring production to North America and creating a responsive manufacturing model. “We can simulate every aspect down to a machine level of how we can optimize the setup and the layout within the factory and therefore the production flow, which ultimately should help us on the one side to cost-optimize, but on the other side to have the quality of the product as well,” says Michael Voegele, Adidas’ chief information officer. Adidas has said it plans to get 50% of its sales from âspeed-enabledâ products by 2020. SpeedFactory Honda / Acura Titanium B/D/F/H/J Series Intake/Exhaust Manifold Stud Kits. Though Adidas has two Speedfactories, management forecasts the combined annual output will be one million units globally, or less than 0.3% of total volume of Adidas sneakers . With the current R&D spend that Adidas is currently subscribing to, hopefully this issue is sorted out soon. 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