There are three types of manufacturing production process; make to stock (MTS), make to order (MTO) and make to assemble (MTA).

  1. Make-To-Stock (MTS)

In this system a factory produces goods that are held in stock at stores and showrooms. This means that a market for the goods needs to be predicted so that the items can be produced in advance ready for the consumer. However, producing too much can mean that surplus stock needs to be sold at a loss while producing too little may mean the market is missed and costs aren’t covered by sales.

  2. Make-To-Order (MTO)

The make to order method allows the manufacturer to wait until orders are received before production begins. This makes it much easier to manage inventories and react to market demand. However, customers will need to wait for their products to be produced and the manufacturer will need a steady stream of orders to keep the factory in production and profitable.

  3. Make-To-Assemble (MTA)

This method is similar to make to stock, except the factory will produce component parts in anticipation of orders for assembly. This means that the manufacturer is ready to fulfil customer orders as they arrive, but can leave the manufacturer with a stock of unwanted parts if there is no demand.

As shown above, all of these types of manufacturing have their own risks related to supply and demand. Produce too much and the market will be flooded, leading to a drop in prices and profit. Produce too little and the customer will go elsewhere and meaning that potential profit is lost. Quality control is also an important aspect of any manufacturing process in order to protect the image of your brand and products.A successful manufacturing business requires a good mix of sales management, stock management, quality control and production costing.

   

      Manufacturing is an expensive undertaking. Manufacturers must delicately balance materials, labor, and overhead costs against sales goals to maximize profits and hit their  targets. Manufacturing quotes estimate the raw materials, labor, and margins needed to create a specific item. They help keep businesses on track with their production goals by providing an estimated cost for the desired item before production begins. By understanding their costs and production capabilities, businesses can price their items more effectively and ensure they meet their profit goals.

      Customers benefit from quotes, too. Most customers obtain quotes from different manufacturers to compare pricing, quality, and delivery times before deciding which manufacturer to use for their production needs.

     Quoting also provides invaluable insights into the entire supply chain process, allowing businesses to plan for future production needs more efficiently. Companies can make sound decisions on material quality and price with comprehensive quotes containing pertinent information related to components and services.

     Quotes help navigate this complex equation, ensuring customers quickly have an idea of the cost of a given job. This can be a tricky process as manufacturers must have a strong record of their overhead and operating expenses across all the different parts they offer, as well as the ability to estimate custom and net new part profiles.