![]() ![]() The final customer refers to a known individual owner and excludes all orders by the original equipment manufacturer (OEM), national sales companies (NSC), dealers or point of sales, bulk orders or other intermediaries in the supply chain. In an automotive context, BTO is a demand driven production approach where a product is scheduled and built in response to a confirmed order received for it from a final customer. In general, the BTO approach has become more popular in the last few years ever since high-tech companies such as Dell, BMW, Compaq and Gateway successfully implemented the system into their business operations. automobiles, bicycles, computer servers, or for products where holding inventories is very expensive, e.g. This approach is considered good for highly configured products, e.g. Moreover, "Made to order" products are common in the food service industry, such as at restaurants.īTO can be considered a Just in Time (JIT) production system, as components or products are only delivered just in time when demanded, in order to reduce wasted time and increase efficiency. Industries with expensive inventory use this production approach. BTO is the oldest style of order fulfillment and is the most appropriate approach used for highly customized or low volume products. Such production orders can be generated manually, or through inventory/production management programs. The ordered product is customized, meeting the design requirements of an individual, organization or business. Thus, the end consumer determines the time and number of produced products. Advertised configurations are customizable and assembled upon orderīuild to Order ( BTO: sometimes referred to as Make to Order or Made to Order ( MTO)) is a production approach where products are not built until a confirmed order for products is received. For the real estate development scheme in Singapore, see Build to order (HDB). For the television program, see Made to Order (television series). This lack of inventory is exactly what makes JIT so great to companies in reducing costs, yet making it risky as well by in some cases not having enough buffer inventories to react and keep the supply chain moving."Made to Order" redirects here. When a ship arriving from Asia full of supplies cannot make it to shore, the company using JIT generally has very little inventory to compensate for the emergency. “Adhering to the just-in-time concept can be expensive in times of emergency such as at ports” (Greenburg, 2002). Labor strikes, stock-outs, and port lockouts can quickly disrupt an entire supply chain while JIT processes are in place. JIT processes can be risky to certain businesses and vulnerable to the supply chain in situations such as labor strikes, interrupted supply lines, market demand fluctuations, stock-outs, lack of communication upstream and downstream in the supply chain, and unforeseen production interruptions. Because of this strong interdependence with JIT, a weakness in the supply chain caused by a JIT weakness can be very costly to all linked in the chain. Everyone relies on everybody else” (Greenberg, 2002). “In just-in-time, everything is very interdependent. ![]() ![]() Just as JIT has many strong points, there are weaknesses as well. ![]()
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