Lead Time

Lead time is the total time that elapses between an order’s placement and its receipt. It includes:

  • the time required for order transmittal,
  • order processing,
  • order preparation,
  • and transit.

Lead time is a key metric in logistics and supply chain management, as it directly affects the efficiency and cost-effectiveness of operations. In general, the shorter the lead time, the more efficient and effective the operation will be. Lead times can vary significantly depending on the type of business and product being shipped. For example, lead times for manufacturing companies are typically much longer than lead times for retail companies.

Lead time can also be affected by factors such as seasonal demand, supplier reliability, and transportation conditions. Therefore, it is important for businesses to closely monitor their lead times and work to continuously improve them.

Related Links

Lead time
Logistics and Supply Chain – LeanCor Supply Chain Group LeanCor Supply Chain Group
Lead Time Definition
Lead Time

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