Introduction

Business Central can be configured to optimize manufacturing for Job Shops, ETO, and MTO environments. Understanding the differences is critical when configuring manufacturing, planning, costing, projects, and supply chain processes.  First, let’s define our terms and compare and contrast MTO, ETO, and Job Shops

Make-to-Order (MTO)

In MTO, products are produced only after a customer order is received. The design is generally standardized, but production begins in response to actual demand rather than forecasted demand.

Example: A machine shop builds a standard conveyor system after receiving a purchase order from the customer.

Engineer-to-Order (ETO)

With ETO, a product or solution must be substantially engineered, designed, or customized to meet a customer’s unique requirements before manufacturing can begin. Engineering activities are a significant part of the fulfillment process.

Example: A manufacturer designs and builds a custom automated production line specifically for one customer’s facility.

Job Shop

Job shops are characterized by low-volume, high-mix production where products move through work centers based on the specific routing and requirements of each job. Job shops often perform custom work but typically rely on existing manufacturing capabilities and processes rather than extensive new engineering.

Example: A precision machine shop producing custom machined parts from customer-supplied drawings

Managing Complexity in ETO

Engineer-to-Order (ETO) manufacturers face a unique set of challenges that differ significantly from both traditional Make-to-Order (MTO) manufacturers and job shops. In a Make-to-Order environment, manufacturers typically build products after receiving a customer order, but the product design, bill of materials, and manufacturing processes are already established. Job shops similarly produce parts or assemblies based on customer drawings and specifications. ETO companies, however, begin with a customer requirement and engineer a custom solution from scratch before production can even begin. This engineering phase introduces additional complexity, uncertainty, and risk. One of the biggest challenges ETO companies face is balancing customer expectations with the realities of engineering, procurement, and production. Sales teams often commit to aggressive delivery dates before engineering is complete, making communication across departments critical. Microsoft Dynamics 365 Business Central helps bridge these gaps by providing a centralized platform where sales, engineering, purchasing, and production teams can share real-time information, improving visibility and enabling more accurate delivery commitments.

Capacity Planning

Capacity management presents another major challenge for ETO manufacturers. Unlike traditional MTO manufacturers that can often predict production requirements using historical demand and established routings, ETO companies must manage both engineering and manufacturing capacity for highly customized projects. Understanding future workloads, engineering resource constraints, and production bottlenecks can be difficult when every project is unique. Delays in design, material procurement, or manufacturing can quickly impact project schedules and customer commitments. Business Central helps manufacturers better manage ETO capacity by providing visibility into resource loads, work center utilization, production schedules, purchasing requirements, and material availability. By identifying capacity constraints early, companies can make informed decisions about staffing, outsourcing, procurement timing, and project prioritization. This improved visibility strengthens supply chain planning and enables more reliable customer delivery dates.

Cost Control and Financial Management

Cost control and financial management are equally important in ETO environments. Costs are directly tied to engineering effort, material availability, production capacity, and project timelines. Design-to-cost initiatives become particularly challenging when engineering changes, long-lead materials, and customer revisions occur throughout the project lifecycle. Without accurate visibility into labor, materials, subcontracting, and overhead costs, profitability can quickly erode. Business Central’s Projects module, combined with project accounting and integrated manufacturing capabilities across modules, provides detailed insight into job costs from design through delivery. Organizations can track budgets versus actual costs, monitor project profitability, and identify cost overruns before they become significant issues. Additionally, Business Central helps ETO manufacturers scale their operations through robust revenue recognition capabilities. By aligning revenue recognition with project milestones, percentage-of-completion (POC) methods, or contractual requirements, companies can better match revenue with expenses, improve financial reporting accuracy, and gain a clearer picture of business performance as they grow.

Business Central Focus

Each manufacturing strategy requires its own unique configuration and setup to optimize how each module works with each other. Each setup can be complex and nuanced.  This is a delicate balance and is summarized in each of the graphics below.

AltiusERP Can Help

Successfully implementing Business Central in a manufacturing environment requires more than simply turning on modules and configuring screens. Every manufacturer operates differently, and the optimal solution depends on whether the company follows an Engineer-to-Order (ETO), Make-to-Order (MTO), Job Shop, Configure-to-Order (CTO), or mixed-mode manufacturing strategy. At AltiusERP, manufacturing is our sole focus. We bring deep experience helping manufacturers align Business Central with their unique operational processes, supply chain requirements, costing methodologies, and financial reporting needs. From engineering-driven manufacturers to high-mix job shops and traditional make-to-order operations, we help organizations design practical solutions that improve visibility, increase efficiency, and support long-term growth. By combining industry best practices with hands-on manufacturing expertise, AltiusERP helps companies maximize the value of their Business Central investment and build a system that scales with their business.  AltiusERP – Elevate your business

Every year, AltiusERP spends a good amount of time visiting manufacturing trade shows around the country, speaking to hundreds of manufacturers across many industry verticals. In doing so, a clear pattern has begun to emerge – many companies were still in the startup or early growth phase and simply could not justify the licensing or implementation costs associated with more advanced ERP systems. Others were still operating on spreadsheets or QuickBooks and, because they had never experienced a modern ERP platform, struggled to immediately recognize the operational value and long-term return on investment. We realized that to truly serve the manufacturing market, we needed an entry-level ERP offering designed specifically for companies taking their first step beyond disconnected systems and manual processes.

As a result, we began researching Enterprise software platforms that are purpose-built for smaller manufacturers and growing businesses. We evaluated systems based on affordability, ease of implementation, ease of training, usability, and the ability to deliver quick operational wins without overwhelming organizations with unnecessary complexity. One platform consistently rose to the top — Odoo. With its low licensing costs, simplified implementation model, modern user interface, and tightly integrated business applications, Odoo quickly became the obvious choice for our small business clientele. Today, Odoo allows AltiusERP to provide a practical, affordable ERP path for manufacturers looking to move beyond spreadsheets and QuickBooks while building a foundation for future growth. For our smaller clientele, we decided to compare #Odoo to our primary product offering, Microsoft Dynamics 365 #BusinessCentral. Let’s break it down.

While both platforms (#BusinessCentral and Odoo) offer manufacturing functionality, they are not equally suited for every type of manufacturer. In most cases, Microsoft Dynamics 365 Business Central is the stronger long-term solution for manufacturers with operational complexity, growth ambitions, and a need for deeper financial and supply chain control. Odoo can be an excellent fit for smaller companies seeking simplicity and affordability, but manufacturers should carefully evaluate whether it can scale alongside increasingly complex production requirements.

For manufacturing organizations, Business Central typically offers a more mature and capable manufacturing platform. Its native functionality includes production orders, bills of materials, routings, machine and labor center capacity planning, MRP/MPS, version management, subcontracting, lot and serial traceability, and robust costing methods such as standard costing. These capabilities become increasingly important as manufacturers grow and require better visibility into margins, inventory valuation, work-in-process, labor absorption, and production performance. Business Central also integrates deeply with the Microsoft ecosystem—including Excel, Outlook, Teams, Power BI, and the broader Azure platform—providing manufacturers with powerful reporting, automation, and business intelligence capabilities. For manufacturers operating in make-to-order, engineer-to-order, job shop, or mixed-mode environments, Business Central often delivers the structure and depth needed to support long-term operational maturity.

That said, Odoo Manufacturing does have clear advantages for certain organizations. Smaller manufacturers, startups, and eCommerce-oriented businesses often appreciate Odoo’s lower licensing costs, modern user interface, and simplified implementation model. Odoo reduces much of the complexity traditionally associated with ERP and offers an impressive suite of tightly integrated applications on a single platform. However, as manufacturing complexity increases—particularly around costing, warehouse management, production scheduling, compliance, or multi-entity financial reporting—many companies begin to encounter the limitations of a lighter manufacturing architecture. For manufacturers focused on scalability, operational discipline, and long-term process maturity, Microsoft Dynamics 365 Business Central is often the better investment, even if it requires greater upfront planning and implementation effort.

Key takeaways:

Strengths of Business Central for Manufacturing

More mature and robust manufacturing platform.
Strong native capabilities, including: Production orders Bills of Materials (BOMs) Routings Machine & labor center capacity planning MRP/MPS Version management Subcontracting Lot & serial traceability Standard costing
Better visibility into: Margins and profitability Inventory valuation Work-in-process (WIP) Labor absorption Production performance
Deep integration with the Microsoft ecosystem: Excel Outlook Teams Power BI Azure
Often better suited for: Make-to-order manufacturers Engineer-to-order businesses Job shops Mixed-mode manufacturing environments

Strengths of Odoo Manufacturing

Lower licensing and implementation costs.
Modern, intuitive user interface.
Faster and simpler implementation.
Strong all-in-one platform with tightly integrated apps.
Well-suited for: Small manufacturers Startups eCommerce-driven businesses Companies moving beyond spreadsheets

Potential Limitations of Odoo

May struggle as manufacturing complexity increases, particularly with: Advanced costing Warehouse management Production scheduling Compliance requirements Multi-entity financial reporting
Scalability may become a concern for larger or more operationally mature manufacturers.

Bottom Line

Choose Odoo if you need a cost-effective, easy-to-use ERP for simpler manufacturing operations.
Choose Business Central if you need scalability, stronger manufacturing depth, advanced financials, and long-term operational control.

AltiusERP – Elevate your business

For manufacturers and distribution companies, selecting a new ERP system is one of the most important technology decisions they will make. The right platform can improve operational visibility, streamline processes, reduce manual effort, and create a foundation for growth. However, not all ERP systems are built for the same type of business. Factors such as company size, operational complexity, budget, and long-term objectives all play a critical role in determining which solution is the best fit. Two of today’s leading cloud ERP platforms—Odoo and Microsoft Dynamics 365 Business Central—offer powerful capabilities, but they serve different needs and business profiles.

Choosing the right ERP system can feel overwhelming, especially for manufacturers balancing growth, cost, and operational complexity. For smaller manufacturers, startups, and companies moving beyond spreadsheets or disconnected software, Odoo Cloud ERP offers an attractive entry point. With lower licensing costs, a simplified user experience, and an impressive suite of applications included on a single platform—from CRM and Sales to Manufacturing, Inventory, Accounting, and eCommerce—Odoo removes much of the complexity traditionally associated with ERP. Its low-code and no-code capabilities also empower business users to create workflows, dashboards, reports, and custom functionality without relying heavily on developers, making it an appealing option for lean organizations seeking quick wins and rapid deployment.

On the other hand, Microsoft Dynamics 365 Business Central is often a stronger fit for mid-market manufacturers and distribution companies with more advanced operational requirements. Business Central offers robust financials, supply chain management, warehousing, manufacturing, and deep integration across the Microsoft ecosystem, including Excel, Outlook, Teams, Power BI, and the broader Azure platform. However, that power often comes with increased complexity. Implementations tend to be longer, more costly, and additional functionality frequently requires custom development or third-party add-ins at an additional expense. For organizations with sophisticated business processes, compliance needs, or larger operational footprints, the investment can deliver significant long-term value.

At AltiusERP, we believe there is no one-size-fits-all ERP solution. That’s why we proudly partner with both Microsoft Dynamics 365 Business Central and Odoo, helping manufacturers and warehousing companies choose the platform that best aligns with their size, budget, and long-term goals. With decades of experience implementing ERP systems for manufacturing and distribution environments, our team focuses on practical outcomes, phased deployments, and measurable business improvements—whether you need a lightweight, all-in-one ERP platform like Odoo or the enterprise-grade capabilities of Business Central.

Ultimately, ERP success is not just about choosing software—it is about choosing the right strategy and implementation partner. A thoughtfully planned ERP deployment can transform operations, improve decision-making, and position your company for long-term growth. Whether your organization needs the simplicity and affordability of Odoo or the advanced capabilities of Business Central, AltiusERP brings decades of manufacturing and warehousing expertise to help guide your digital transformation with confidence. AltiusERP – Elevate Your Business

A phased ERP implementation could be the winning strategy for your company.

Implementing a new ERP system can feel overwhelming. Too often, businesses are promised a silver bullet—only to end up buried in lengthy implementations, bloated scopes, endless meetings, and frustrated teams wondering if the disruption was worth it. The reality? Trying to boil the ocean on day one is one of the biggest reasons ERP projects stall or fail.

That’s why AltiusERP takes a different approach with Odoo software. Instead of forcing an all-at-once transformation, we focus on quick wins through a Minimum Viable Product (MVP) strategy—rolling out core business functions first and building momentum through phased implementation. Start with the essentials like sales, purchasing, inventory, manufacturing, or accounting, stabilize operations, and then layer in additional modules over time. The result is faster user adoption, lower risk, quicker ROI, and a software platform that grows with your business instead of disrupting it.

When you partner with AltiusERP, you get more than software—you get a practical implementation strategy built around your business. As a manufacturing-exclusive ERP consulting firm, AltiusERP understands the operational realities of small and mid-sized manufacturers and helps clients prioritize the processes that matter most first. By combining the flexible, cost-effective platform of Odoo with the deep manufacturing expertise at AltiusERP, companies can modernize at a pace that makes sense, reduce implementation risk, and create a roadmap for continuous improvement without the sticker shock or complexity of traditional enterprise systems.