In brief
Replenishment lead time is the period from identifying a requirement until the material is available in stock or at the point of use.
Contents
What is Replenishment lead time?
Replenishment lead time covers more than the supplier's lead time. It begins when the requirement is identified and ends when the part has been inspected and stored ready for use. It is a key input for calculating the reorder point and safety stock. The longer and more uncertain it is, the larger the buffer in stock must be to avoid stock-outs.
Typical components are the internal processing time for the requirement notification, purchase requisition and approval, transmission of the order, the supplier's lead time including production or procurement from the upstream supplier, inbound delivery, and goods receipt and inspection. Each of these phases can become shorter or longer; shortages at the manufacturer have a direct impact on the total duration.
For spare parts, replenishment lead time often varies widely. Standard parts are sometimes available at short notice, while special versions or made-to-order parts can take considerably longer. Anyone planning with outdated values sets reorder points too low and risks downtime. The actual times from past orders should therefore be evaluated regularly and updated in the material master.
In practice: maintenance and procurement
In addition to the supplier's stated figure, the actually measured replenishment lead time should also be maintained in the material master. For critical parts with long lead times, it is worth considering framework agreements with reserved quantities or orders brought forward on the basis of the maintenance plan.
Synonyms and abbreviations: replenishment time · procurement lead time · total lead time
Frequently asked questions
What is the difference between lead time and replenishment lead time?
Lead time is only the time the supplier needs from the order to delivery. Replenishment lead time is more comprehensive: it also includes internal steps such as determining requirements, approval and ordering, as well as goods receipt with inspection. For inventory planning, replenishment lead time is therefore decisive.
How is replenishment lead time calculated?
You add up the duration of the individual phases: identification of the requirement and purchase requisition, approval and ordering, the supplier's lead time, inbound delivery, and goods receipt and inspection. The most reliable figure is an average from orders actually processed, supplemented by the observed variation, which feeds into the sizing of the safety stock.
How can replenishment lead time be shortened?
Internally, lean approval processes, framework agreements with call-off orders and electronic order processing help. Externally, suppliers with their own stockholding, agreed reservations or consignment stock have an effect. For special parts, early demand planning from maintenance plans can bring the order forward so that long production times do not become a bottleneck.