Average Supplier Lead Time
This metric measures the average number of days needed for a company's suppliers to process, prepare or select, ship, and deliver its purchase orders. Supplier lead time begins when the supplier receives the purchase order and ends upon fulfillment or receipt of the order at the company's designated delivery point. This lead time directly affects inventory levels and inventory carrying costs. There are various points in the purchase order cycle where lead time can be improved without a high investment in the distribution process. Solutions can include a change in the mode of order transmittal or a change in the transit mode of distribution. Seeing this picture benchmarked within its industry focus should induce a lower-performing organization to work closer with their supplier partners to determine the best solutions.
Participate in the Open Standards Benchmarking Collaborative SM (OSBC) research to learn how your organization's performance compares to top performers and industry peers. Visit www.apqc.org/OSBCdatabase to benchmark your organization's performance at no charge. Participants receive custom reports that help establish improvement priorities and set goals for performance. Supply chain professionals are encouraged to complete any and all supply chain online surveys focused on customer order management, logistics, manufacturing, new product/service development, and procurement. Nonprofit APQC serves as the sole custodian of the OSBC database, which guarantees confidentiality. All metrics are validated, normalized, and aggregated to ensure apples-to-apples comparisons.