Make to order

Defregger F, Kuhn H (2007) Revenue management for a make-to-order company with limited inventory capacity. OR Spectrum 29 137-156... 

Make-to-order Make-to-forecast Make-to-stock"... 

Nature of the business in terms of customer orders This cheuacterization includes make-to-stock, make-to-order, assemble-to-order, and engineer-to-order. It has a great deal to do with what the detailed business operations ace and how operational and tactical planning is done. Qeariy this categorization has a tremendous influence on the ERP requirements emd on the behavior of the enterprise in its supply chain. More than any other, this characterization determines the nature of the delivery activities and the dependence on supplier relationships. 

Make-to-order has two interpretations. Technically, anything that is not made-to-stock is made-to-order. In aU cases there is an explicit customer order, and thus aU make-to-order systems are described as pull systems. However, it is important to distinguish make-to-demand systems, in which products are made in batches, from option-to-order systems, in which order-specific features are installed on a product-by-product basis. The distinction between make-to-demand batch planning and on-the-fly option selection using single setup and prepositioning is very important to the ERP system. 

Make-to-Order Manufacturing or Service with No Tasks Done Prior to Customer Arrival... 

Hendry, L. C., and Kingsman, B. G. (1989), Production Plemning Systems and Their Applicability to Make-to-Order Companies, European Journal of Operational Research, Vol. 40, pp. 1-15. 

Strategy column of the table has MTO, make-to-order strategy. ATO is assembly-to-order strategy that means manufacturing components and assembling them based on customer order. MTP is make-to-plan. Total manufacturing cost includes manufacturing, inventory, and transportation costs. The relationship... 

If the manufacturer and retailer were to carry no inventory and all production and orders followed customer order placement, the product purchase price paid by the customer would be minimized. Notice that this corresponds to a make-to-order system at the manufacturer and assumes... 

On the other hand, if the manufacturer operates in a make-to-order manner, the retailer has to carry inventory to cover the lead time of + L , and the customer will only need to carry inventory to cover his transport lead time of L[. 

Consider an example of the Instock store that sells ten different types of products. Demand for each product each day follows a normal distribution with a mean of 50 units and a standard deviation of 25 units. All these products are produced by a manufacturer who carries no finished goods inventory, i.e., operates a make-to-order system. 

Ueda K, Lengyel A, Hatono L (2004) Emergent synthesis approaches to control and planning in make to order manufacturing environments. CIRP Ann Manuf Technol 53(l) 385-388... 

If we assume a make-to-stock production when discussing the distribution core process, the Storage Operating Curves, already outlined above in regards to procurement, can be applied. In comparison, with a make-to-order production. 

In addition, mass customization can also improve inventory and supply chain management efficiency. As mass customization is a make-to-order process, usually products are only made when the purchase order is placed. Thus, the shift from made-to-stock to made-to-order can significantly improve the production and supply scheduling and reduce the inventory cost and the risks of investment in materials and product development that will not encounter the preference of consumers. Furthermore, mass customization can be conducted online in some cases, so that many providers even sell shoes completely online without any physical stores, such as Zappos. This strategy can further reduce the operation and rental costs by online direct channel sales and increase the profit margin rate (Tseng et al. 2003). Even for those providers still with physical stores, they no longer have to show a full inventory of selection in all stores. 

In the make-to-order factory, one of the most important production objectives is to meet the due dates of production orders. Since the processing time of production process is uncertain probabilistically, the completion time of each production order is also uncertain. It is difficult to evaluate directly whether the due dates are met. In this chapter, the total satisfactory level SL is used to evaluate the performance of all orders to meet their due dates, which is expressed as follows ... 

It is significant to note that each of these three companies pioneered both product and process innovation over the course of the history of supply chain management. They spawned new business models. For Apple to be successful, it required the definition of ilUnes. Dell defined a make-to-order online business model. P G s work on customer-driven supply chains drove market share. 

When the journey for supply chain excellence started 30 years ago, each industry had a different starting point. They also had a different vision and path for their journey. The discrete and make-to-order manufacturers (aerospace and defense, automotive, and industrial manufacturing) supply chain processes originated in procurement. In contrast, the foundation of process companies supply chain organizations (chemical, consumer products, and pharmaceutical) was in manufacturing. 

The Sales lane is entirely within level 4 of ISA-95. The plant processes tiles according to a make-to-order approach. Check stock and Ship order have been marked as send tasks, as they... 

There are no commercial powder blasting systems available because there is not such a market. Only a few places worldwide have utilized this technique. There are companies that can make custom-designed powder blasting systems. They only make to order. However, there are some companies, such as Micronit in the Netherlands, which provide powder blast micromachining services. 

The second case is when a product has low volume and high variability, which in this case a make-to-order production strategy (or pull system) should be used, which avoids the need for an SKU level forecast. 

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