Supplier lead time
How long a supplier actually takes, and how much that varies.
01 What it is
Why anyone looks at this number
How long a supplier actually takes, and how much that varies.
Lead time drives safety stock more than demand variability does. The variability matters more than the average: a reliable 40 days needs less stock than an erratic 20.
02 The formula
How it is worked out
Supplier lead time = mean and variability of (goods_receipt_date − purchase_order_date) grain : supplier × material unit : days source : Purchasing and goods receipt in the ERP
Compare the actual receipt against the original promise, not the last revision. Rescheduling is how a late delivery becomes an on-time one in the data.
03 Worked example
The same number, with real inputs
| Average lead time | 45 days |
| Standard deviation | 11 days |
| Master data setting | 30 days |
| Calculation | — |
| Result | 45 ± 11 days, planned as 30 |
The system plans 30 days for something that takes 45. Every replenishment starts fifteen days late, and safety stock is quietly covering a master data error.
04 What moves it
Four things that actually change this number
Supplier capacity
Their constraint becomes yours.
Order size and frequency
Small frequent orders often get deprioritised.
Transport mode
Sea versus air is weeks versus days, and cost versus cash.
Customs and compliance
Border and certification delays that no expediting can fix.
05 Where the number lives
The system, the record and the fields
| System of record | Key record | Fields you need |
|---|---|---|
| Purchasing and goods receipt in the ERP | Purchase order line joined to Goods receipt | po_date, confirmed_date, receipt_date, quantity, supplier_id |
Compare the actual receipt against the original promise, not the last revision. Rescheduling is how a late delivery becomes an on-time one in the data.
06 How it goes wrong
Three ways this metric misleads people
Trusting the master data
Planned lead times are set at go-live and rarely revisited.
Fix: Recalculate from actual receipts quarterly and update the master.Averaging away variability
The average is fine; the tail is what causes stockouts.
Fix: Track the spread, not just the mean.Measuring against revised dates
Every reschedule resets the clock and the supplier looks reliable.
Fix: Always measure against the first confirmed date.08 Questions
Frequently asked
Why does lead time variability matter more than the average?
Because you can plan for a long lead time, but you have to hold stock against an unpredictable one. Variability is what safety stock is actually paying for.
How often should planned lead times be updated?
At least quarterly, from actual receipts. Stale master data is one of the most common and most expensive silent errors in a supply chain.
One definition, everywhere it is used
SCIKIQ stores this metric once and serves it to every dashboard, board pack and agent that asks.