When planning and scheduling production, a key component is the demand for items. An item can be produced in one of two ways:
Make-to-order (MTO)
Make-to-stock (MTS).
Assign this designation in the Manufacturing Policy field on the item card.
Make-to-order items
An MTO item is not stored in inventory but rather produced as needed. Production does not begin until a customer places an order for the item. It is therefore critical to quickly and easily notify production personnel of customer requests. You can do this in the program using the Batch Planning Worksheet. A production order can be automatically generated for a sales line item or groups of line items if the intermediate item of each sales item is the same.
After an order is placed for an MTO item, the required amount of the item appears on the Batch Planning Worksheet. From here, you can schedule a date for production and create a production order.
Make-to-stock items
An MTS item is produced on a regular basis and stored in inventory. When a customer order is placed for the item, it is filled from inventory stock.
Demand for MTS items typically comes from production forecast or safety stock quantity requirements. Outstanding sales order quantities that exceed forecasted amounts should also be considered.
After these data elements are entered into the system, an item's demand requirements can be compared against supply information using the Quick Planner Worksheet. If demand outweighs supply, the necessary production can be planned.
Once production is planned in the Quick Planner, the required amount of the item appears on the Batch Planning Worksheet. From here, you can schedule a date for production and create a production order.