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Configure to Order

What does configure to order mean?

Configure to order (CTO) is the manufacturing process of assembling and configuring products according to customer requirements. Configure to order  represents the customer’s ability to define the configuration of a product in real-time, and  in today’s competitive market, businesses who use CTO have quite an advantage, since more and more consumers are demanding products that are tailored to their unique needs.

Frequently Asked Questions

  • How does configure to order work?

    When companies utilize a work in process approach (like CTO), their design selection is completed after the work order has been received. That’s because this process is based around specified customer requirements, picked from a set of product features with predefined values. With these customer requests in place, manufacturers use a combination of parts in the final assembly to create a pre-established modification or variant of a product.

  • What are the benefits of using configure to order?

    A configure to order manufacturing model is used by online retailers to create custom-made products according to the exact specifications of their customers. This strategy brings some definite advantages to your supply chain and inventory management, like shorter lead times and faster order fulfillment workflow. What’s more, the CTO order process eliminates stocking excess inventory, because you’re only sourcing whatever inventory is needed for the customer. 

  • What is an example of configure to order?

    With CTO order management, products are assembled and configured on the shop floor based on customer order requirements — meaning they’re basically engineer to order once customer specifications are known. Examples of configuration items in the real world include the sales order for a car (with all its customizations), or ordering a personal computer over the internet.

More terms and formulas

Other Amazon Marketing Services (AMS) See definition and examples
inventory Work in Process (WIP) Inventory See definition and examples
Other Made To Stock See definition and examples

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