In logistics, “lead time” is the total time it takes from when a customer places an order until they receive the product. This includes several stages:
- Order processing. The time needed to handle the order internally, like entering, checking, and confirming it.
- Manufacturing. If the product isn’t ready-made, the time required to produce or assemble it.
- Packaging. The time to pack the product for shipment.
- Shipping. The time it takes to transport the product from the warehouse or factory to the customer.
- Receiving. The time it takes for the customer to receive and check the product once it arrives.
Reducing lead time can be done by improving processes, coordinating better with suppliers, and using efficient transportation methods.
