What is lead time?
October 30, 2026
Lead time is the time between placing an order and receiving it. For a retailer it usually means supplier lead time: the days or weeks from sending a purchase order to the stock arriving and being ready to sell.
Formula
Reorder point = average daily sales × lead time (days) + safety stock
Why it matters for online retailers
Lead time decides when you need to reorder. If a supplier takes three weeks to deliver, you need to order while you still have at least three weeks of stock left. Reorder too late and you run out; reorder too early and cash sits in the warehouse.
Types of lead time
- Supplier lead time: from placing a purchase order to receiving the stock.
- Manufacturing lead time: how long a product takes to make, if you make your own.
- Customer lead time: from a customer ordering to receiving their parcel.
How to calculate it
Supplier lead time = the date stock is received and ready to sell minus the date the purchase order was placed.
Lead time then sets your reorder point. For example, if you sell 20 units a day, the supplier takes 14 days and you keep 60 units of safety stock, the reorder point is 20 × 14 + 60 = 340 units.
Common causes of long or unpredictable lead times
- Overseas suppliers and long shipping routes
- Customs and import delays
- Minimum order quantities that mean waiting to fill an order
- A goods-in backlog, so stock arrives but is not booked in
How StoreFeeder handles it
StoreFeeder records supplier lead times and uses them in stock forecasting, so reorder suggestions allow for how long each supplier takes. Basic forecasting is included in every plan; advanced forecasting is part of the Advanced Operations Pro add-on.
Read more about StoreFeeder inventory and stock forecasting.
Frequently asked questions
What is a good lead time?
Shorter is better, but a consistent lead time matters as much as a short one, because it makes reordering predictable.
What is the difference between lead time and delivery time?
Delivery time is only the transport part. Supplier lead time also includes the time to process, pick and ship the order, and to book stock in when it arrives.
How can I reduce lead time?
Use suppliers closer to home, agree delivery targets, order more regularly in smaller amounts where minimum order quantities allow, and book stock in quickly when it arrives.
