How to Calculate Lead Time
What is Lead Time?
Tracks time from order placement to delivery/production completion. Critical for supply chain planning and customer delivery commitments.
Step-by-Step Guide
- 1Record order dates and delivery dates across suppliers/products
- 2Calculate average days between
- 3Track variability (min/max)
- 4Compare to quoted lead times
Worked Examples
Input
Order to delivery
Result
14 days
Common Mistakes to Avoid
- ✕Only using average lead time, ignoring variability
- ✕Not accounting for custom production lead times
Frequently Asked Questions
Why measure lead time variability?
Variability creates planning difficulty; consistent lead times improve inventory management.
How do I reduce lead time?
Build closer supplier relationships, increase order frequency, use local suppliers, or reduce customization.
Ready to calculate? Try the free Lead Time Calculator
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