What is ETO (Engineer-to-Order)?
A manufacturing strategy where products are designed and engineered to customer specifications before production begins.
Definition
Engineer-to-Order (ETO) is a manufacturing strategy where products are custom-designed and engineered based on unique customer requirements before production starts. Unlike Make-to-Stock (MTS) or Make-to-Order (MTO), ETO products often require new engineering designs, custom BOMs, and unique manufacturing processes for each order. ETO is common in industries like aerospace, defense, industrial machinery, and construction equipment where each product is unique or highly customized.
How ETO Works in ERP
ETO in ERP requires strong project management, engineering change management, and configurable BOM capabilities. The ERP must support design-to-production workflows, progress billing, project costing, and integration with CAD/PLM systems. Not all ERPs handle ETO well — vendors like IFS, Epicor Kinetic, and Infor CloudSuite are particularly strong for ETO manufacturers.
ERP Vendors with Strong ETO
Frequently Asked Questions
What is the difference between ETO, MTO, and MTS?
MTS (Make-to-Stock) manufactures to inventory based on forecasts. MTO (Make-to-Order) starts production when a customer order is received using standard designs. ETO (Engineer-to-Order) requires custom engineering and design before production can even begin.
Which ERP is best for ETO manufacturing?
IFS Applications, Epicor Kinetic, and Infor CloudSuite are considered the strongest ERPs for ETO manufacturing due to their project management, engineering change management, and configurable BOM capabilities.