Question

Consider a business that can be run using a make-to-stock or make-to-order process. Further suppose that your demand is 10000 per monthand is spread out during the month. Capacity of both processes is 15000per month. Based only on this information, what would be the best choice?a. Choose Make-to-stock process.
b. Choose make-to-order process.
c. Either A or B.
d. Both A and B
e. None of the above

Answer 1

The best choice would be Choose Make-to-Order Process.

Option b

Explanation:

Make to order (MTO) also known as made to order, is a type of business production strategy which allows the customers to buy the products that are designed or customised based on their own specifications.

In simpler words, this process involves the production of customised goods after the consent of the consumers.

Here it has been mentioned that the demand is 10,000 units per month and the capacity of the company production is 15,000 units. So, it can be inferred that the company would have enough time to produce the goods based on the desirability of the customers. (customised products).

Therefore, the best choice would be Choose make-to-order process.