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What is ATO | Assembly to Order

Assembly to Order (ATO) is a production strategy where products are assembled upon receiving a customer's order, using pre-planned and stocked components. It reduces inventory costs, allows customization, and aligns with lean manufacturing principles. 📌 Related videos ▶ What is Cellular Manufacturing    • What is Cellular Manufacturing | Lean...   ✍ Here is the transcript of the video ▶ What is ATO Assembly to Order (ATO) is a production strategy where products are assembled upon receipt of a customer's order. The key components used in the assembly or manufacturing process are planned and usually stocked in anticipation of a customer order. Receipt of an order initiates assembly of the customized product. This strategy is useful where a large number of end products (based on the selection of options and accessories) can be assembled from common components. ▶ ATO Benefits ATO strategy reduces the need for maintaining a large inventory of finished products, thus saving on inventory holding costs and improving cash flow. It also provides a way to offer customization of the final product to the customer's specific needs. However, it requires a well-organized production process to ensure that components are available when needed and that assembly can be completed in a timely manner. In the context of lean manufacturing, ATO aligns with the principles of reducing waste and increasing efficiency. It allows for the reduction of waste associated with overproduction and excess inventory, while increasing efficiency by enabling a smooth flow in the production process. However, it requires a high level of coordination among various functions such as sales, production, and supply chain management. ▶ Conclusions In summary, Assembly to Order is a production strategy that can lead to cost savings, improved cash flow, and increased customer satisfaction by providing customized products. However, it requires a well-coordinated and efficient production process to be successful. ツ CONNECT WITH ME ツ Hi, my name is Mark Anderson a 20+ year Lean Expert. I have created LeanVlog because I want to spread Lean Thinking worldwide and I think the video is the most effective way to teach, learn, and spread knowledge. If you want to stay in touch with me you can choose the channel you prefer. A) Linkedin   / mark-anderson-leanvlog   B) Latest Videos and Playlist Website: https://www.leanvlog.com C) Telegram https://t.me/leanvlog #assemblytoorder #ato