5 Things You Can do Now to Reduce Production Lead Times
Production lead times are the amount of time that it takes you from when you receive an order, to when you get the stock from your supplier. Or, it could be defined as the amount of time from when the customer placed an order to the time that they receive their items. However, manufacturing lead time is a little different and is defined as the amount of time that it takes to create a product, and then have it delivered to your customer. Component manufacturing, therefore, can be a tough issue due to the long production lead times.
Choosing Batch Orders
The first thing that you are going to need to do is to choose batch orders instead of individual ones. To put it simply, this is where the picker will compile a list of orders that all share something in common such as their shipping address. Then, later down the line, they will be split apart at the point where they are going to be shipped. It makes the process that much faster and will help get your products out to your customers sooner rather than later.
Use Inventory Management Software
Another thing that you want to try is inventory management software. If you want to eliminate human error as much as possible, and you do if you want to speed up your process in the most efficient way possible, then you’re going to want to think about inventory management software. A tool like this will help you stay on top of the inventory that you have, and will mean that nobody in the business has to sit there with multiple spreadsheets open at any given time, trying to make sense of what is happening.
If you can, you may want to try and work out how you can condense your supply chain to make it that bit easier to manage. For example, if you are having to spend half of your production time managing different suppliers, making sure each vendor knows what they are doing, and ensuring that they are all in sync with each other, your business process will be the one to suffer.
If you’re not getting your orders placed promptly simply because you are trying to manage all of these relationships at the same time, your production lead times are what will suffer, dragging your entire business down.
Create An Incentive
It may well be the case that your supplier has given you a lead time of around 14 weeks. But, you want it done earlier, preferably somewhere around 11 weeks. What are you going to do about it? Well, you can create an incentive to get everything sorted out sooner than they had scheduled by offering bonuses depending on how quickly they can achieve the goal.
For example, you can offer one bonus if they can have it done by 12 weeks, a larger one for 11 weeks and an even larger one for 10 weeks. This provides the supplier with a reason to want to get a move on and helps get you what you need, sooner. The tiered system of offering your incentives gives them a choice as to how far they want to go to get each bonus.
Order Less, More Frequently
Instead of ordering so much at one time, and then having to wait for a huge order to be processed, sorted out and then shipped to you, why don’t you send in small orders more frequently? This is going to make your life, and the life of your supplier, that much easier. You won’t have to wait so long for your order to be fulfilled, meaning that you can get your products out to your customers sooner.
The amount that you are ordering will seriously impact your production lead times, which is why you need to think about this. It might take a little trial and error, but you will find the amount that works well for you in terms of time, and then you can stick with it.
We hope that you have found this article helpful, and now see five of the things that you can do to reduce production leads times. Hopefully, you now understand why these things are important, and why they are something that you need to do in your business as soon as possible. We wish you the best of luck.
Sick of long production lead times? You might be able to save time AND money by altering your manufacturing process. Read our guide here to find out more.