MTO can help a manufacturer offer custom products without keeping large numbers of finished goods in stock. It can also reduce the risk of making products that no one has ordered. The trade-off is that customers may wait longer for delivery, because production begins after the order is confirmed.
An ERP system can support MTO by linking the sales order to material planning, purchasing, production scheduling, work orders and delivery. This helps the company check whether it has the materials and capacity needed to meet the promised delivery date.
