A tankless water heater produces hot water almost instantly at the heater, but it may take a while to travel to your fixtures.  Cold water in the piping must be emptied before you will feel the hot water produced by the tankless heater.  Longer, larger diameter pipes have more water volume than shorter, smaller pipes therefore take longer to empty.  Poor insulation may also increase hot water wait times since the water is cooled as it travels through the piping.  In order to reduce the wait time for hot water, recirculation systems and on-demand pumps may be used. 
Recirculation systems require a dedicated recirculation line and pump in order to operate.  A pump pushes water around this loop ensuring the water is already heated in your piping.  These systems require additional energy to heat the recirculation line and will typically be more costly to operate.  In order to reduce the heater operation time and to maintain heater warranty, we recommend using a aquastat and timer to control the pump.The main advantage of this system is "instant" hot water delivery to all fixtures in your home.
On-Demand pumps are installed underneath the sink and pump hot water directly to a specific fixture.  These systems are easier to install than recirculation systems and typically cost less (due to reduced material and labor costs.)  They do not produce "instant" hot water and typically require activation either by a push button or motion sensor.  Their main advantages come in reducing wait time for hot water and wasted water down the drain.  Consult your plumber for more information or find a local certified Noritz installer at www.noritz.com