Build-to-order

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Build-to-order ( English: build to order for " production according to order ", abbreviated BTO ; more rarely also built to order for "built to order") or make-to-order (MTO) is a strategic-operational approach of companies . A product is only manufactured after the customer has placed an order. The counterpart is the stock production (Engl. Build to stock (BTS)).

In practice, one often encounters a combination of make-to-stock and contract manufacturing. In the automotive industry, both vehicles are produced in stock that are available from dealers and can be taken away immediately, as well as vehicles that are exclusively made to customer specifications, i.e. H. according to the respective configuration of the customer. Here the customer has to accept a certain delivery time before he can take over “his” vehicle.

For example, some computer manufacturers offer basic models (e.g. barebones ), which the customer can then use as a modular system with different processors, hard drives, memory modules, drives, graphics cards, etc. a. can equip. The end product is defined in detail by the customer and only manufactured in the desired configuration after the order has been placed .

The suppliers of the respective company usually keep the components and delivery parts until they are needed. The required parts are only requested from the supplier after a specific order has been placed by a customer. Therefore, the supplier introduces extradition stock to be able to supply parts quickly (for example, within an hour) the company's production. For this purpose, demand forecasts must be exchanged and collected between the company and the supplier, since the supplier is obliged to coordinate his planning and storage. With just-in-time production or just-in-sequence production , however, no distribution warehouse is required at the supplier, because the supplier also only produces after the customer order and the parts, assemblies or modules are delivered to the manufacturer of the end product on time or in sequence delivers.

Customer order decoupling point

The manufacture of complex products, which are composed of many assemblies and sub-assemblies, often requires long manufacturing and lead times; this also applies to some assemblies and parts, the production or procurement times of which are often very long. If all manufacturing and procurement processes were only started when a specific customer order was received, the entire order processing time would be very long and in many cases even too long for the customer. Therefore, a certain scope of production is already prefabricated without a specific customer order. This significantly shortens the order processing time without building up stocks of end products. The point in the process up to which the customer is anonymously manufactured is also called the decoupling point . In this respect, strictly speaking, production is only based on the BTO principle from the decoupling point. Which point is suitable as a decoupling point cannot be answered in general, but has to be determined anew for each product. In the automotive industry, a point in the body-in-white is often chosen as the decoupling point, which is also called the baptism point, because this is where the customer order is assigned to a specific body.

advantages

The advantages of BTO productions are, in addition to the rapid flow of funds for everyone involved:

  • for manufacturers
    • direct customer contact and precise knowledge of the products actually required
    • No middlemen (customer orders directly from the manufacturer), higher added value
    • No or little need for replenishment stocks / short dwell times in the warehouse, which keeps storage costs low
    • no drop in prices due to slow-moving goods as with pure series production
    • quick response to changed market conditions
  • for customers
    • Goods as requested instead of pure mass production
    • newer built-in parts (use of the latest technology)
    • direct contact to the manufacturer (possibly online support)

disadvantage

  • high fixed costs due to empty capacity
  • fluctuating utilization of capacities
  • It is difficult to determine the optimal order quantity or lot size
  • high procurement costs, since economies of scale may not be able to be used
  • long delivery times to the customer as the product is not kept in stock

Application and dissemination

In many branches of industry such as the automotive, electronics or furniture industry, the tendency has increased in recent years to manufacture as many products as possible according to customer orders, not only to reduce storage costs, but also to reduce the risk of already manufactured parts to “stay seated”. Such stock products can then only be sold through high price discounts and cheap financing, which reduces profits accordingly. One example of this is the 2008/2009 financial and automobile crisis in the USA, where American manufacturers initially continued to produce, although sales had already declined, and then had to sell their vehicles at low prices. Another reason for BTO is the increasing variety of variants and the customers' desire for an individual product, as can be seen in the automotive industry. In order to keep costs under control, attempts are made to manufacture the product variant ordered by the customer as late as possible, i.e. at the end of the production chain in pre- assembly and final assembly , from prefabricated individual parts or assemblies . The decoupling point plays an important role here; this indicates until when customer-anonymous and from when customer-related production.

swell

  1. ^ W. Herlyn: PPS in automobile construction. Hanser Verlag, Munich 2012, ISBN 978-3-446-41370-2 , p. 200.
  2. ^ W. Herlyn: PPS in automobile construction. Hanser Verlag, Munich 2012, ISBN 978-3-446-41370-2 , pp. 57-64.

literature

  • P. Glenn, A. Graves (Eds.): Build to Order - The Road to a 5-Day Car. Springer Verlag, London 2008, ISBN 978-1-84800-224-1 . (springer.com)
  • W. Herlyn: PPS in automobile construction - production program planning and control of vehicles and assemblies. Hanser Verlag, Munich 2012, ISBN 978-3-446-41370-2 .
  • H.-P. Wiendahl, D. Gerst, L. Keunecke (Ed.): Mastery of Variants in Assembly - Concept and Practice of the Flexible Final Production Stage. Springer Verlag, Berlin 2004, ISBN 3-540-14042-5 .

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