Producing to Order

• What is one way a business can match supply to demand effectively?

  Produce to order
• What does "producing to order" mean?

  Production starts only after receiving an order
• How can a business increase its supply?

  By outsourcing or using temporary employees
• Who was a leader in the concept of producing to order in the computer industry?

  Dell
• What happens when a customer customizes their computer order with Dell?

  Manufacturing begins after the order is complete
• What are the benefits and drawbacks of producing to order?

  Benefits:

  • Avoids holding large inventory
  • Higher customer satisfaction for custom orders

  
  

  Drawbacks:

  • Limits production capacity
  • Hard to meet sudden demand surges
• Why might producing to order lead to higher customer satisfaction?

  Customers receive exactly what they want
• What is a potential limitation of producing to order for a business?

  It could limit production capacity
• What challenge might arise from a sudden surge in demand when producing to order?

  It may be hard to meet all demand
• What is one requirement for producing to order?

  Receiving a customer order first