Pull or Make-to-order describes producing stock in response to actual demand.

Pull or Make-to-order describes producing stock in response to actual demand.

• A. Producing stock in response to actual demand
• B. Producing stock on the basis of anticipated demand
• C. Producing stock after customer orders
• D. Producing stock to fill backorders immediately

Answer: (A)

The idea being tested is that pull systems and make-to-order production are driven by actual demand, not forecasts. In a pull or make-to-order setup, you don’t start producing based on expected sales; you wait for a real signal—an actual customer need or order. This keeps inventory lower and reduces the risk of building stock that might not be sold. Producing stock on the basis of anticipated demand describes a push approach, where forecasts drive production decisions, which can lead to excess or obsolete inventory if demand turns out differently. Producing stock after customer orders is indeed aligned with make-to-order, but the broader, more fundamental description is that production is triggered by actual demand, which best captures the pull/MTO concept. Producing stock to fill backorders immediately is about expediting to clear existing shortages, not about the overall production paradigm.

The idea being tested is that pull systems and make-to-order production are driven by actual demand, not forecasts. In a pull or make-to-order setup, you don’t start producing based on expected sales; you wait for a real signal—an actual customer need or order. This keeps inventory lower and reduces the risk of building stock that might not be sold.

Producing stock on the basis of anticipated demand describes a push approach, where forecasts drive production decisions, which can lead to excess or obsolete inventory if demand turns out differently. Producing stock after customer orders is indeed aligned with make-to-order, but the broader, more fundamental description is that production is triggered by actual demand, which best captures the pull/MTO concept. Producing stock to fill backorders immediately is about expediting to clear existing shortages, not about the overall production paradigm.