← Business Dictionary
Operations

Lead Time

Also known as leadtime

How long it takes from placing an order to actually receiving it. Longer lead times force you to hold more stock.

Example

If your supplier has a 45-day lead time, you must order November’s stock in September.

Related terms

Turnaround Time
How long you take to finish a task from the moment it arrives — a support ticket, a repair, an order.
Inventory
The goods you are holding and have not sold yet. It is cash sitting on a shelf — too little and you miss sales, too much and you are broke but full of stock.
Supply Chain
Everything it takes to get a product from raw material to your customer’s hands — suppliers, manufacturing, storage and delivery.

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