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 In the business world, lead time is the time difference between customer order for a service/product to delivery and completion of the order process. For example, your business produces various fashion. It takes two days to get raw materials to make the product and another two days to sew and complete 100 sets of final products. This mean lead time for your business to produce 100 products is four days. You will agree that when customers place orders, especially online, they want their orders to be delivered quickly. If your online business fulfillment or delivery process takes too long, you will potentially lose customers and lower sales rates. So, to retain your customers, you should make sure to reduce your business lead time. So what exactly is Lead Time Function For Business Performance

Here are some of the lead time functions for business performance:

Estimates demand. You will find it easier to estimate direct demand from the market and estimate product needs in a planned manner. So, you can determine how many products must be in stock to fulfill customer orders.

Order management is more organized. You can manage your incoming and outgoing inventory in the warehouse easily and in a planned manner so that deliveries arrives on time and restocked at the right time..

Better coordination with suppliers. Regarding the provision of the goods you need, you can ensure more clarity regarding delivery times, product quantities, return policies, and etc to meet customer requests.

Increase customer satisfaction and retention. Ethically, it shortens waiting times, meaning your customers receive their orders on time. Therefore, customers are more likely to return to buy your products and judge that your business has fast service and delivery. This creates customer loyalty to your business.

Improve supply-chain. Just imagine if the fulfillment of your business orders is often late, customers would not want to repeat orders at your retail store. As a result, the inventory in the warehouse has piled up due to dead stock. It's different if your waiting time is low, the supply chain operations will be more optimal, aka the entry and exit of goods faster, and will not cause inventory buildup.