Quick Summary: Supplier lead time measures the days between placing an order and receiving goods. Master how the app determines and applies this metric to ensure accurate replenishment planning and realistic supplier expectations.
What Lead Time Represents
Lead Time includes all time from order placement to usable stock, not just supplier shipping. This means:
Supplier processing and shipping time
Transport and customs clearance
Internal admin time, such as order approvals or ERP processing
Warehouse receiving and put-away time
Together, these steps make up the total lead time.
Lead Time can apply to both:
External suppliers, such as an overseas manufacturers.
Internal suppliers, such as a Distribution Center (DC), replenishing a branch.
When to Place the Order
The app uses Lead Time to determine how far in advance to place an order.
If a supplier’s Lead Time is 45 days, the system ensures the next order is created about 45 days before safety stock is reached.
In other words, Lead Time controls the timing of when orders are raised — not how much stock is ordered.
➜ For more on this topic, read: Replenishment Cycle vs. Lead Time Explained
Why Accuracy Matters
Inaccurate Lead Time data doesn’t only cause late orders and potential stockouts.
It also affects your safety stock calculations, because the system can’t tell the difference between an incorrect Lead Time setting and a supplier who consistently delivers late.
As a result, safety stock may inflate unnecessarily to “protect” against what looks like unreliable supply.
➜ For more on this topic, read: Supply Risk & Offset Explained
The Preferred Supplier
The app bases its planning on the preferred supplier assigned to each item at each location. All lead time driven calculations, such as when to place an order and how much safety stock to hold, use the Planning Lead Time for that supplier.
If you choose to source an item from a different supplier at the last minute, make sure the order is raised at the correct time for that supplier’s actual lead time. The Planning Lead Time shown in the app may not apply to the alternative supplier, and using it may cause premature or delayed replenishment.
How To Set Lead Time (Options)
➜ Read: How To: Set Lead Time (Options)
⚠️ Watchouts
Lead time accuracy: Incorrect lead times distort replenishment timing and safety stock calculations. Always ensure that the planning lead time reflects your supplier’s true delivery performance.
Preferred supplier logic: The app performs all lead-time planning using the preferred supplier assigned to each item at each location. If you decide to source an item from another supplier at the last minute, be sure to place that order at the correct time. The Planning Lead Time shown in the app may not apply to the alternative supplier.
💡 Tips
Use one source of truth: Keep lead time data synchronized between your ERP and the app to avoid conflicting values.
Validate regularly: Review and confirm lead times during supplier reviews or replenishment cycle audits to ensure continued accuracy.
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