is a production method used when a product must be designed or engineered for a specific customer. After the customer places an order, the company develops or changes the product design before purchasing materials and starting production.
ETO is common for complex or highly customized products, such as industrial machines, special equipment and large engineering projects. Because design, purchasing and production happen in sequence, delivery usually takes longer than for standard products.
An ERP system can connect the customer order with engineering tasks, product documents, bills of materials, purchasing, project planning and production. This helps teams track changes, costs, materials and deadlines from the first design work through delivery.
