Make to Order and Make to stock

[Former Member]

Dear Guru's

Any bady can explain me Make - To - Order and Make To Stock.

Regards

ksr

[Former Member · Accepted solution]

Make to Order : Production against a received order

Make to Stock : Production against forecasts. Since there are no open orders at the time of production, it is generally stocked in a warehouse. Hence Make to Stock.

These concepts have a bearing in the turnaround time of an order. Generally Make to stock strategy has a lesser turnaround time vs Make to order as the stock is already available for the order in MTS strategy, whereas in MTO, production time would be added to the turnaround time. Further, MTS is planned when the company doesn't often change their products specifications and do not to customize assembling. While, customize assembling and product variants are possible in MTO.

Both the strategy is highly dependent on the product profile.

Thanks

Nikhil

[Former Member]

hai,

make to order:

it is a buisness scenario where the company produces goods according to the

needsand specifications of the customer,the product sold is not stored on the shelves.the product could be very similar but merely change a portion for differen t of its forms for different sales orders.the production cycle is trigered according to how the customer likes to see the product but not the company.

make to stock:

here the production is done irrespective of the customer orders, it is usually done on the basis of the sales forecasts not on the customer specifications, it is usually a push strategy,company produces the products and they are sold.

there is no customising of the product.

get back in case of any further clarifications.

regards

reward points

sriram.

[Former Member]

Make to Order:

A type of production in which a product is manufactured for a particular customer.

Includes both sales order production and engineer-to-order.

Make to Stock:

An inventory of goods that were not manufactured for specific sales orders or projects.

Regards

AK