When you configure a make to order route, you are telling Odoo that you wish for draft purchase orders to be created when a sales order includes that specific product, regardless of the stock you have on hand. For example, even if you had 2,000 of a product in stock and a customer orders 10 of that product, Odoo will create a draft purchase order for 10 units if you have the Make To Order route checked.
Often, a business would use the make to order option when they do not need to keep stock of a product, and instead will either manufacture or purchase the product for reselling once a sales order is confirmed. It is certainly possible to use a combination of buy and make to order with re-ordering limits to set up a system ...