Mcor Technologies, an Ireland-based 3-D printing company whose printers use ordinary copy paper as its primary material, has future plans to enter the 3-D printing as a service segment in a more meaningful way. 3D Systems (NYSE:DDD), Stratasys (NASDAQ:SSYS), and many other 3-D printing companies compete in the servicing space because it generates healthy profit margins and often leads to subsequent sales of 3-D printers. It should come as no surprise to 3D Systems and Stratasys investors that lesser-known Mcor is trying to grow its install base by featuring its 3-D printers that operate at a fraction of the cost in more service centers around the world. The biggest difference is that Mcor isn't trying to lock its customers into buying high-margin consumables.
On a high level, the 3-D printing as a service segment allows customers to buy professionally 3-D printed objects without the expertise associated with owning a 3-D printer. 3D Systems operates its Quickparts 3-D printing service and recently acquired Robtec, the largest Latin American 3-D printing service provider as a way to expand its servicing capacity and expertise in the region. Stratasys made a similar move when it purchased Solid Concepts and Harvest Technologies, two leading U.S. 3-D printing service providers, which are well regarded for their 3-D printing manufacturing expertise. Last September, Mcor announced that its 3-D printing technology will be featured on Staples' myeasy3D, a 3-D printing as a service that allows users to upload their designs and pick them up at a local Staples in the Netherlands.
Because trials in the Netherlands have gone well, Mcor has plans to partner with other companies that will buy its 3-D printers and begin offering services around them. 3D Systems and Stratasys employ a similar business model where it sells its 3-D printers to third-party service centers because it often results in the sale of highly profitable consumables. Because Mcor 3-D printers rely on office paper, it doesn't have the opportunity to sell consumables in the same manner.
In the following video, 3-D printing specialist Steve Heller asks Mcor CEO Conor MacCormack about the company's service offerings. Going forward, 3D Systems and Stratasys investors should watch what services providers Mcor partners with next, and whether or not it has the potential to encroach on their respective 3-D printer businesses.
A transcript follows the video.
Steve Heller: You have something set up like that in the Netherlands with Staples, is that correct?
Conor MacCormack: Yes.
Heller: How is that going for you?
MacCormack: It's going very well. As we said, Staples in the Netherlands and the Benelux region is looking after that. You can go to a website called "My Easy 3D," you can upload your content, and you can get your parts printed out exclusively on an Mcor product.
Staples in the U.S. and Staples in Europe are very different entities, but we do believe that that was a proving ground for us, as a company, to realize that this is a vehicle for Mcor to get access to the consumer.
We're already talking to very big global brands about doing something very similar, but on a global level. One of the biggest frustrations, especially in the U.S., was people saying, "Well, this is brilliant. I can go to my local Staples store," but it actually was only available to people in the Netherlands.
Now we're expanding that out with other companies, with the same kind of a business model -- where people upload their content or take a photograph and try and make that into 3D, or use a scanner or a Kinect scanner, or whatever the easy ways to get 3D data -- and walk into a store or go to a place where you get your 2D photographs printed, and get that now printed out in 3D.
That, we believe, is how the consumer segment is going to grow.
Heller: Yes. Mcor Technologies is coming to Shapeways hopefully, in the future, or taking on Shapeways. It sounds like interacting with a service center is going to be a bigger area of focus for you in the future.
MacCormack: Yes. For our company, we will see ourselves as an R&D company. We develop new products, and we bring these products to market. But we always see the opportunity here, and there's a huge opportunity here on the service side.
A lot of the big companies that we're up against will have their own service arms, but we get a lot of requests from people about doing service. We think that the consumer segment is a perfect vehicle for that to happen.
We have very good dealers globally, around the world, that sell our products on the industrial side. But on the consumer side, we need something a little bit different. As I said, some of the new products that we have coming out in the very near future are really, we believe, going to take the 3D printing world by storm, again, like they did when we came out with our first paper printers, many years ago.
Steve Heller owns shares of 3D Systems. The Motley Fool recommends 3D Systems and Stratasys. The Motley Fool owns shares of 3D Systems and Stratasys. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.