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Home > Research Report > III, Results of Research > (1) Estimating the market size of the prototyping industry > 1,Estimating the extent of "outsourcing" by large companies

Forewold

III, Results of Research

(1) Estimating the market size of the prototyping industry

1,Estimating the extent of "outsourcing" by large companies

The main areas for large companies to order "prototypes" seem to cover a wide range of processes, such as development, design, fabrication, testing, etc., in connection with "R&D" and "equipment investment", but there is no means available in the public domain to grasp the total amount spent for these orders.
Thus, in this research by questionnaire we selected 600 from the 2,154 listed companies in order to gather their "R&D expenses" and "equipment investment costs" as well as their "outsourcing costs," which are presumed to be the object of the prototyping area in a broad sense, and then made rough estimates of these categories.
Based on the results of the research by questionnaire and the existing statistical data, we used the following method to estimate the market size for "outsourcing" by large companies (listed manufacturing companies).

According to the results of the research by questionnaire, the ratio of the outsourcing expense to the R&D expense of the listed manufacturing companies among the valid responses was approximately 7.6%, and the same ratio to equipment investment costs was approximately 8.5%.
On the other hand, according to the 2001 "Report of the Research on Science and Technology Studies" by the Ministry of Internal Affairs and Communications, the "R&D expense" of the manufacturers with capital of \1 billion or more was approximately \9 trillion. The outsourcing expense included in this amount is estimated to be about \680 billion at the same ratio of 7.6% as the result of the research by questionnaire.
Likewise, according to the 2001 "Statistical Research of Corporations" by the Ministry of Finance, the "equipment investment costs" of the manufacturers with capital of \1 billion or more was approximately \6.3 trillion. The "outsourcing expense" included in this amount is estimated to be approximately \540 billion at a ratio of 8.5%, which was similarly obtained.
Thus the total outsourcing costs relative to R&D and equipment investment activities by the large manufacturing companies (with capital of \1 billion or more) are estimated to be approximately \1.22 trillion annually.

Estimating the extent of "outsourcing" by large manufacturers
[Results of Questionnaires]

Note:"Approximately" is omitted. B = Billion

[Estimating the extent of outsourcing by listed manufacturers]

[Estimating the outsourcing size by large manufacturers
(with capital of \1 B or more)]

Note 1)	The amounts of R&D and equipment investment for all listed manufacturers were calculated from the financial data for the fiscal year 2002 of the 600 companies that were targets of this research.
Note 2)	The R&D costs of the manufacturers with capital of \1B or more are statistical values based on the 2001 "Report of the Research on Science and Technology Studies" by the Ministry of Internal Affairs and Communications.
Note 3)	The R&D and EI costs of the manufacturers with capital of \1B or more are estimated values based on the statistical values in the 2001 "Statistical Research on Corporations" by the Ministry of Finance.

Table of Contents

I, Purpose and Method of Research

II, Summary of Research Report

III, Results of Research

(1)Estimating the market size of the prototyping industry
|_ 1,Estimating the extent of "outsourcing" by large companies
|_ 2,Extent of "outsourcing" by universities

(2) Prediction of promising fields for the prototyping industry
|_ 1,The current situation of outsourcing
    -1,Utilization
    -2,Contents of outsourced orders
|_ 2,Outlook for Outsourcing
    -1,Prospect for increased outsourcing
    -2,Predicted contents of outsourcing
    -3,Expected outsourcing of "prototyping"

(3)Conditions for promoting orders to make prototypes
|_ 1,The critical points for clients in selecting contractors for outsourcing
|_ 2,Methods of selecting contractors
|_ 3,Methods by which trust is granted [to contractors]
L 4,Issues

Important factors in selecting contractors
(weighted-average values)

Methods of selecting outside contractors

Trust granted to outside contractors

Issues when increasing outsourcing

IV,Potential for promoting the prototyping industry

V,Suggestions for promotion of the prototyping industry

Kyoto Industries 21 Foundation