SAP PP Planning Strategies Make to Order

What is Make to Order (MTO) in SAP PP?

Make to Order (MTO) is a planning and production strategy where a product is manufactured only after a customer places an order. Unlike Make to Stock (MTS), where products are built in advance and kept in inventory, MTO waits for a real sales order before triggering production.

The key feature of MTO is that every production run is linked to a specific customer order. This means stock is not produced “generically” — it is created specifically for that order.

Why Do Companies Use Make to Order?

Companies choose MTO when:

Products are customized or configurable
Demand is unpredictable
Products are expensive to store
Inventory costs are high
Each customer wants a different variant or specification
Stocking finished goods is not practical

Key Planning Strategies for MTO

Here are the common SAP PP planning strategies used for Make to Order:

Strategy 20 – Make to Order Production (most common)
- Directly produces against sales order
- No PIRs (forecasts)
- Stock is assigned to sales order
- Simple MTO process for standard or semi-standard products
Strategy 50 – Planning with Final Assembly
- Used for configurable products (e.g., variant configuration).
- Production starts after sales order arrives.
- Components may still use forecast-based planning.
Strategy 25 – Make-to-Order for Configurable Materials
- Used with Variant Configuration (class type 300).
- Each sales order can choose different characteristics.
Strategy 21 – Make to Order without Final Assembly
- Used when final assembly is triggered only when customer order is received, but early stages may be pre-planned.