Glossary · Planning
What is Lead time?
Lead time is the time between placing an order with a supplier and having the stock received and ready to sell.
It includes production or picking at the supplier, transit, customs where relevant, and receiving and putaway at your end. Quoted lead times are often shorter than real ones, which is why measured lead times from past orders are more reliable.
Variability matters as much as the average. A supplier averaging 21 days but ranging from 14 to 35 forces much more safety stock than one that delivers in 21 days every time.
How Stokrio handles it
Stokrio measures actual lead times from received purchase orders and uses both the average and the variability in safety stock.
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