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Ideas and Innovation

The Industrial Revolution 2.0

From Friday's Globe and Mail

Poppy Adams wanted to start a business designing glass jewellery. She had the skills: The 36-year-old, who lives in Langley, British Columbia, was trained in glassmaking and metalsmithing. But she didn’t have the means: She needed a kiln to fire her own glass, and some way to reach customers. Kilns cost thousands of dollars—a lot of money if her business didn’t take off—and where exactly was she going to sell her jewellery? The local Langley market just isn’t that big.

Two years ago, technology solved both of these problems. Fuelled by engineering breakthroughs and a surge in DIY home crafters, kiln- makers began producing “tabletop” models, microwave-sized and suitable for an apartment; Adams found one online for $800. Now she was able to fire glass in any size, shape or colour that a customer could desire.

Then she heard about Etsy, a Brooklyn, New York-based e-commerce website where craftspeople set up virtual stores. Founded in 2005, Etsy now has more than 50 employees and 200,000 users running “shops” that sell about $90 million worth of products a year to 2.3 million members. Using the screen name Groovyglassgirl, Adams began selling her custom-fired glass in January, 2007. She ships 75 orders a month, most of them to international clients.

“What I’m doing now basically wasn’t possible five years ago,” she says. “The technology has come a long way.”

Welcome to the Industrial Revolution 2.0. The last wave of North American manufacturing died off in the ’80s and ’90s, when manual-labour work decamped for the rock-bottom wages of developing countries like China. Between 2004 and 2008, one in seven Canadian manufacturing jobs disappeared. Over the past decade, the United States lost close to one-quarter of its jobs in the manufacturing sector. And the old paradigm isn’t coming back. We are increasingly becoming a society that consumes but does not make. Companies like Etsy, however, herald an interesting shift: Call it micromanufacturing. Advances in technology mean that small firms—literally mom-and-pop shops—can design products and take them to the global market, sometimes in a matter of hours.

The trend has been driven by the plunging cost of industrial-quality manufacturing tools. Several Web-based firms—like eMachineshop and Ponoko—offer kitchen-table entrepreneurs access to elite industrial design and production tools, such as laser cutters and injection-moulding machines (the latter can cost $10,000 or more to purchase). It’s reminiscent of how Kinko’s brought high-end printing to the masses in the ’80s, enabling a boom in self-publishing: If you couldn’t afford high-end design software and laser printing, you could simply rent it by the hour.

Ponoko, a New Zealand-based service, works in a similar way. Anyone can design a product—using tools as simple as CorelDraw or even paper and pencil—and upload the plans to its Ponoko website. Clients choose their materials (from cloth to brass to wood), and Ponoko’s laser cutters produce it, to 1,000th-of-an-inch precision. The creator can then set up a store and sell the product, with Ponoko (which currently has a staff of five) taking care of credit-card billing and shipping. Because the site produces each product on the fly as customers place their orders, creators don’t need to stock an inventory of gewgaws. More than 15,000 customers have uploaded products; some have sold so well they’ve generated six-figure incomes for their designers. One product—a drink coaster made from the letters of the alphabet—was designed by a teenager during his summer break. He landed his first sale within three weeks and, a few months later, the global design warehouse Veer started selling the product.

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