Understanding odoo mrp make to order vs make to stock is essential before you touch a single product configuration. These are not settings you flip casually. They are production strategies that determine when you manufacture, how you procure raw materials, and what inventory you carry. Getting the configuration wrong means either holding stock nobody ordered or quoting lead times you cannot meet. This guide covers how to configure each strategy in Odoo manufacturing and what happens operationally when you choose one over the other.
📋 Key Takeaways
- MTO produces after a confirmed order. MTS produces before orders arrive based on forecasts and reordering rules. Odoo configures this per product via procurement routes, not a global switch.
- MTO creates a manufacturing order linked to a specific sales order. If raw materials are short, purchase orders are created automatically. Zero finished goods inventory.
- MTS uses reordering rules to maintain minimum stock. Production is triggered by stock levels, not customer orders. Faster delivery but capital tied in inventory.
- Most manufacturers run both. Standard products on MTS. Custom or configured products on MTO. Odoo handles mixed mode natively.
- The most common mistake is leaving all products on the wrong strategy. High variety products on MTS create dead stock. Fast movers on MTO create unnecessary lead time.
📑 Table of Contents
- MTO and MTS as Different Production Realities
- How Odoo Handles Each Strategy
- Procurement Rules per Strategy
- Reordering and Replenishment Differences
- Planning and Scheduling Implications
- Using MTO and MTS Together in Mixed Mode
- Where Defaults Assume the Wrong Strategy
- Inventory Impact of Each Choice
- Reporting Differences
- Choosing the Right Setup for Your Product Line
- FAQs
MTO and MTS: Two Different Production Realities
Make-to-Stock (MTS)
- Produce before orders arrive. Build inventory based on forecasts and minimum stock levels.
- Customer orders are fulfilled from existing stock. Delivery is fast because the product is already made.
- Risk includes overproduction, dead stock, and capital locked in inventory that may not sell.
- Best for standard products with predictable demand.
Make-to-Order (MTO)
- Produce only after a confirmed customer order. Nothing is manufactured without a buyer.
- Delivery depends on production lead time. Customer waits while the product is made.
- Risk includes longer delivery times, rush production under pressure, and raw material availability.
- Best for custom products, configured to order items, and high value low volume production.
How Odoo Configures Each Strategy
MTS configuration in Odoo
- Product route set to Manufacture with no Make to Order route added
- Reordering rule created on the product with minimum and maximum stock levels
- The scheduler runs daily. When stock drops below minimum, a manufacturing order is created automatically.
- Manufacturing order is not linked to any specific sales order. It replenishes stock generally.
MTO configuration in Odoo
- Product route set to Make to Order plus Manufacture
- No reordering rule needed because stock is not maintained
- When a sales order is confirmed, Odoo creates a manufacturing order linked to that specific order
- If raw materials are insufficient, Odoo checks the component route and creates a linked purchase order automatically.
The route is set per product, not globally. This is the core of odoo mrp make to order vs make to stock. Product A can be MTS while Product B can be MTO, and Odoo handles inventory integration across modules for both simultaneously.
Procurement Rules: What Happens Downstream
MTS procurement chain
- Stock drops below minimum, reordering rule triggers, manufacturing order is created, and if raw materials are short their own reordering rules trigger purchase orders. Each step is independent with no link to any sales order.
MTO procurement chain
- Sales order confirmed, manufacturing order created and linked to that sales order, raw materials checked, if short a purchase order is created linked to that manufacturing order, production completes, delivery goes to customer. The entire chain is traceable in one click.
Reordering and Replenishment Differences
- MTS products have reordering rules. A minimum of 50 units and maximum of 200 units means when stock drops to 50, a manufacturing order for 150 units is created.
- MTO products do not have reordering rules. Stock is not maintained. There is no minimum. Every unit produced is for a specific order.
- Raw materials can use reordering rules regardless. Even if the finished product is MTO, the raw materials can be MTS with reordering rules. You do not produce the finished good without an order, but you keep raw materials in stock for quick response.
Planning and Scheduling Implications
- MTS scheduling is proactive. Production is planned based on stock levels and forecasts. You know what to produce and when based on consumption patterns. Capacity can be levelled across weeks.
- MTO scheduling is reactive. Orders arrive and manufacturing orders are created. If ten orders arrive on Monday, ten manufacturing orders compete for capacity. Levelling is harder.
- Lead time affects delivery promise. MTS products ship immediately from stock. MTO products ship after production lead time, which includes manufacturing time plus raw material procurement if needed.
- Capacity planning differs. MTS allows you to smooth production across quiet periods. MTO creates peaks and valleys based on order timing. Manufacturers with limited capacity need to plan buffers.
Using odoo mrp make to order vs make to stock Together: Mixed Mode Production
The typical mixed mode setup
- Standard products covering roughly 80 percent of SKUs use MTS with reordering rules. Fast moving, predictable demand. Ship from stock.
- Custom or configured products covering roughly 20 percent of SKUs use MTO. Made only when ordered. No stock held.
- Raw materials use MTS with reordering rules regardless of finished product strategy, so MTO orders can start production quickly without waiting for procurement.
Mixed-mode is the reality for most manufacturers. Odoo handles it natively because the route is per product. A functional Odoo consultant helps classify your product catalogue into MTO and MTS categories during implementation.
Where Odoo Defaults Assume the Wrong Strategy
⚠️ Common default mistakes
- All products left on MTS. Custom or configured products build stock that nobody ordered. Dead inventory grows. This is the most common mistake in new Odoo implementations.
- All products set to MTO. Standard fast moving products require production for every order. Delivery times increase. Customers who expect immediate shipment are told to wait.
- MTO without raw material reordering rules. Finished product waits for raw materials to be purchased for each order. Production starts weeks late because raw materials are not in stock.
- MTS reordering rules not calibrated. A minimum set too low causes stockouts. A minimum set too high causes excess inventory consuming capital and warehouse space.
The right strategy per product is a business decision, not a technical one. It depends on demand predictability, production lead time, raw material lead time, customer expectations, and the cost of carrying inventory. A certified Odoo ERP consultant helps classify products correctly before routes are configured.
Inventory Impact of Each Choice
- MTS inventory impact. Finished goods stock exists permanently. Capital is tied up. Warehouse space is consumed. Risk of obsolescence if demand changes. Delivery is instant from stock.
- MTO inventory impact. Zero finished goods stock. No capital tied up. No warehouse space for finished products. No obsolescence risk. Delivery depends on production speed.
- WIP impact. Both strategies create work in progress inventory during production. MTO WIP is tied to a specific customer order. MTS WIP replenishes general stock.
- Raw material impact. MTS raw materials are consumed predictably. MTO raw materials are consumed in bursts when orders arrive. If raw materials are also MTO, procurement delays compound lead times further.
Reporting Differences Between MTO and MTS
- MTS reports focus on stock turnover, dead stock, inventory valuation in Odoo accounting, reorder point accuracy, and forecast versus actual demand.
- MTO reports focus on order to delivery lead time, production backlog, on time delivery rate, and capacity utilisation.
- Traceability differs. MTS uses lot numbers on delivery to trace which batch reached which customer. MTO uses the linked manufacturing order to trace which sales order triggered production.
- Costing differs. MTS finished goods carry average or standard cost. MTO finished goods carry the actual production cost for that order, which can vary.
Choosing the Right MTO vs MTS Setup for Your Product Line
Decision framework
- High volume, predictable demand, standard product points to MTS. Keep stock and ship fast.
- Low volume, custom or configured, high value points to MTO. Produce on order with no dead stock risk.
- Seasonal demand suits MTS with adjusted reordering rules that increase minimums before peak season arrives.
- Raw materials with long lead time should stay on MTS with reordering rules regardless of finished product strategy.
- Products with many variants suit MTO for variants with low individual demand and MTS for the top two or three selling variants.
Getting this classification right at the start of your Odoo implementation saves months of inventory correction later. An Odoo partner can also assess whether Odoo customization services are needed to align production workflows with your manufacturing rules.
MTO vs MTS
Not Sure Whether Your Products Should Be MTO or MTS in Odoo?
Tatvamasi Labs helps manufacturers classify product lines, configure procurement routes, and set reordering rules that match how you actually produce.
Discuss Your Manufacturing SetupFrequently Asked Questions
Make-to-stock produces goods before customer orders arrive, building inventory based on forecasts and reordering rules. Make-to-order produces only after a confirmed sales order, triggering manufacturing and procurement on demand. In Odoo MRP, the difference is configured through procurement routes on the product, not a global switch.
Set the product route to include Make to Order plus Manufacture. When a sales order is confirmed, Odoo creates a manufacturing order linked to that specific order. If raw materials are insufficient, purchase orders are created automatically. No stock is held for this product.
Yes. Routes are set per product, not globally. Standard products can use make to stock with reordering rules while custom or configured products use make to order. Both strategies run simultaneously in the same Odoo database.
MTS builds finished goods inventory that ties up capital but enables fast delivery. MTO carries zero finished goods inventory but delivery depends on production lead time. The choice affects cash flow, warehouse space, delivery promise, and obsolescence risk.
Leaving all products on make to stock when some should be make to order. High-variety or custom products on MTS create overstock of configurations that never sell. Equally, putting fast moving standard products on MTO creates unnecessary production lead time for items that should ship from stock.
No. Raw materials can use MTS reordering rules even when the finished product is MTO. Keeping raw materials in stock lets production start quickly after an order is confirmed, without waiting for a separate procurement cycle.
MTS scheduling is proactive. You level production based on stock levels and forecasts. MTO scheduling is reactive. Manufacturing orders are created when sales orders arrive, which can create demand peaks and capacity pressure. MTS allows smoother capacity planning across weeks.
Prefer a quick chat? Talk to the Tatvamasi Labs team about your MRP setup on WhatsApp.
CHAT ON WHATSAPP
