Make To Order Scenario

[Former Member]

Dear SD Gurus,

Please help.

In case of Make to Order scenario what are the additional settings required for the Transfer of requirements and avail.check that are not there in the Make to Stock general sales scenario?

If both scenarios co exist then for MTO do we have to copy the settings and make Z settings?

Can you please guide me? my ID is raja672000@yahoo.com. Thanks

[Former Member]

Hi Adiraj,

Make-to-Order (MTO) Production

Purpose

The planning strategies explained in this section are designed for the production of a material for a specific individual sales order. In other words, you do not want to produce finished products until you receive a sales order. This means that make-to-order strategies always support a very close customer-vendor relationship, because your sales orders are closely linked to production.

The same relationship exists between the sales order and production that exists in a make-to-order environment. Make-to-order is also used in the following environments.

Production using variant configuration

Assemble-to-order

Prerequisites

Choose a make-to-order strategy, if:

The materials are segregated. In other words, they are uniquely assigned to specific sales orders.

Costs must be tracked at sales order level and not on material level.

Make-to-order strategies should always be combined with lot-size key EX (lot-for-lot. Rounding values should not be used. If you maintain rounding values, they have no effect due to the make-to-order properties of these strategies.

Process Flow

There are extensive options that enable you to procure components especially for specific sales order items.

You may, however, want to use a different planning strategy to procure components without sales orders. This allows you to keep your replenishment lead time to a minimum. You can do this by:

Planning on the basis of the finished product (see Planning Without Final Assembly (50) or Planning with a Planning Material (60))

Planning at component level (see Strategies for Planning Components)

Using consumption-based or Kanban-controlled components

Customer stock can exist on any BOM level. See Stockkeeping at Different BOM Levels for more information.

Because production is closely linked to sales orders, this results in a customer section in the stock/requirements list.

Unplanned goods receipts (such as returns) cannot, as a rule, be used for other sales orders, even if they are in working order, unless they are adapted to meet a customer's needs.

In the basic make-to-order strategy, Make-to-Order Production (20), no specific product structures are required. This means that it does not matter if the material has a BOM or not. The material can be produced in-house, or it can be procured externally. No planning is involved in this strategy.

Planning Without Final Assembly (50) and Planning with a Planning Material (60) do require a specific product structure (i.e. a BOM, which means materials are always produced in-house). These planning strategies assume that you want to plan procurement (production or purchasing) of your components by planning the finished products. This means that you need to have a fairly stable demand for your finished products. If, however, you can plan more easily at component level than at finished product level, see Strategies for Planning Components.

Hope this provides clarity. Reward points if helpful.

Regards

Srikanth.A

[Former Member]

The difference between MTO and MTS is determined by the Requirement class.

Your requirements class should have the important settings as below:

1) Special Stock = E

2) Account Ass. Cat = E

3) Valuation = M

4) Settlement Prof = SD1

5) RA Key = 000004

6) Consumption = E

7) Costing Variant = PPC4

😎 CondType Line Items = EK02

The requirements class is triggered based on the settings done in "Determination of Requirement Types using Transaction" (tcode OVZI). Here you assing for the combination Item Category and MRP Type the relevant Requirement Type that has to be determined. Please note that you have to use 1 in the Origin of Requirement Type field to trigger the requirement class from Sales. If nothing is mentioned in this field then the requirements type will be triggered from the strategy group field value in the material master. Requirement Type is uniquely assigned to the requirement class using transaction OVZH.

There are lot of posts on the above topic and you can search the same for more information.

Regards,

GSL.