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Order promising: ATP & CTP
What you can promise a customer from stock and planned supply, and what you could make or buy in time.
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A customer asks: “Can you deliver 5,000 units by 10 October?” A reliable answer needs more than looking at the shelf.
ATP (available to promise) answers from stock and supply already planned:
ATP = stock on hand + scheduled receipts − quantities already promised to other orders
With 1,000 units on hand and 700 already promised, ATP today is 300. If 4,000 more will arrive from production on 6 October and none of it is promised yet, the cumulative ATP by 10 October is 4,300, so the system can confirm 4,300 by the requested date and offer the rest later, or look further.
CTP (capable to promise) goes a step further. For the remaining 700, could we make or buy them in time? CTP checks production capacity, material availability and supplier lead times, and if a slot exists it can promise a later date or even schedule the production.
Good promising matters more than it looks. A sales rep who promises “yes” without checking creates a broken promise later; a promise built on ATP and CTP is one the plant can keep. Promising also interacts with allocation: when stock is scarce, companies often reserve ATP for priority customers or channels, so not all of it is available to the first order that arrives.
Words to use
- ATP
- Uncommitted supply, on hand plus planned receipts minus existing promises, available for new orders.
- CTP
- Whether production capacity and materials can supply an order by a requested date.
- Confirmed date
- The delivery date promised to the customer after the availability check.
Cumulative ATP and look-ahead
ATP is calculated per period, but later commitments can use earlier supply. A correct check therefore looks ahead.
No starting stock. Week 1: 500 units arrive and 200 are already promised. Week 2: nothing arrives and 300 are promised.
- Without look-ahead: week 1 shows 300 available, and a salesperson could promise them to a new customer.
- With look-ahead: week 2’s 300 can only be covered by week 1’s leftover, so week 1’s ATP is really zero.
Promising the 300 would break an existing commitment.
A CTP check, step by step
Back to the gist: a customer wants 5,000 units by 10 October, and ATP can cover 4,300. For the remaining 700:
- Capacity: the filling line has space for 1,000 units on 8 and 9 October.
- Materials: bottles are short; the supplier needs 5 days, so an order placed today arrives on 7 October, in time.
- Logistics: production finishes on 9 October; delivery takes 3 days.
- Answer: confirm 4,300 for 10 October and 700 for 12 October, or ask whether the customer prefers one delivery on the 12th.
CTP is only as good as the capacity and material data behind it, and the slot it uses must then be reserved so it isn’t promised twice.
Rules a promising engine applies
- Product substitution: offer an equivalent item if the requested one is short.
- Location substitution: check other warehouses or plants, with the extra freight or time included.
- Allocation: reserve ATP for customer groups or channels, so the first order doesn’t take everything.
- Partial deliveries: whether the customer accepts splits, and the minimum quantity per delivery.
Promise fidelity
The real test of order promising is whether promises are kept. Promise fidelity, the share of confirmed dates actually met, separates a promising process that reflects reality from one that simply says yes. Low fidelity usually traces back to inaccurate stock records, optimistic lead times or capacity data, or promises made outside the system.
Re-planning backorders
When supply changes (a delayed receipt, a cancelled order, extra production), existing confirmations may need to change. Backorder processing re-runs the check for open orders in priority order, re-confirming dates and moving supply from low-priority to high-priority orders where the rules allow. It should run regularly, with customers told about changes rather than discovering them on the delivery date.
Reserving supply for more valuable orders
If a premium customer segment typically orders later but pays more, giving all ATP to the first orders that arrive can leave nothing for them. Revenue management offers a rule: Littlewood’s rule (1972) says to protect units for the higher-value class as long as the probability that its demand exceeds the protected quantity is at least the ratio of the low value to the high value. With margins of ₹80 for standard orders and ₹120 for premium ones, keep protecting units while the chance that premium demand will use them is at least 80/120 ≈ 67%. Allocation-based ATP puts such protection levels into practice.
Profitable to promise
Some companies extend the idea further: rather than asking only “can we deliver?”, the system evaluates “should we, and where from?”, comparing the margin of each promising option after freight, expediting and the cost of displacing other orders.
The limits of CTP
Capable-to-promise needs a planning engine that respects finite capacity and material availability, and it must not double-book slots used by other planned orders. In complex factories, full CTP for every order can be slow or unreliable; many companies use CTP for selected products or customers and simpler ATP with lead-time rules for the rest.
Interview kit
Practise it out loud
Answer each question yourself before opening the model answer.
ATP tells us what we can promise from stock and planned receipts that aren’t already committed. CTP extends it by checking whether capacity, materials and supplier lead times allow us to make or buy the rest by the requested date. Together they give customers dates the supply chain can actually meet, and they work alongside allocation rules that reserve scarce supply for priority customers.
Stock is 1,000 and existing orders take 700. A customer wants 5,000 by the 10th. How do you respond?
ATP today is 300. Check planned receipts before the 10th: if 4,000 uncommitted units arrive on the 6th, we can confirm 4,300 by the 10th. For the last 700, run a CTP check on capacity and materials; if production can fit them in, confirm a later date or a split delivery.
What is the difference between ATP and CTP?
ATP only looks at existing and planned supply minus commitments. CTP also checks whether new supply can be created in time, using capacity, materials and lead times, and may trigger a new production or purchase plan to meet the order.
Connected stops
Where this idea feeds in, or gets its inputs from.
Sources and further reading
- Chopra, S. & Meindl, P. Supply Chain Management: Strategy, Planning, and Operation. Pearson.
- Silver, E. A., Pyke, D. F. & Thomas, D. J. (2017). Inventory and Production Management in Supply Chains (4th ed.). CRC Press.
- Ball, M. O., Chen, C.-Y., & Zhao, Z.-Y. (2004). Available to promise. In D. Simchi-Levi, S. D. Wu & Z.-J. Shen (Eds.), Handbook of Quantitative Supply Chain Analysis. Springer.
- Littlewood, K. (1972). Forecasting and control of passenger bookings. AGIFORS Symposium Proceedings, 12, 95–117.