7 reasons your lead time is wrong & its costing you millions
TRANSCRIPT
7 Reasons Your Lead Time is Wrong
(And It’s Costing You Millions)
Copyright Data Profits 2015
Lead time is an important factor in any demand-driven forecasting or retail replenishment system.
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Lead time is an important factor in any demand-driven forecasting or retail replenishment system.
It drives your order points and helps you place orders at just the right time.
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If your lead time is inaccurate you will quickly find yourself overstockedor understocked.
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If your lead time is inaccurate you will quickly find yourself overstockedor understocked.
Are you making these common lead time mistakes that cost retailers millions?
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#1 Ignoring internal lead times
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#1 Ignoring internal lead times
The easiest lead time to forget is time from distribution center to store.
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#1 Ignoring internal lead times
The easiest lead time to forget is time from distribution center to store.
Vendor
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#1 Ignoring internal lead times
The easiest lead time to forget is time from distribution center to store.
Vendor
DC
Copyright Data Profits 2015
#1 Ignoring internal lead times
The easiest lead time to forget is time from distribution center to store.
Vendor
DC
Store
Copyright Data Profits 2015
#1 Ignoring internal lead times
The easiest lead time to forget is time from distribution center to store.
Vendor
DC
Store
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#2 Using only vendor-quoted lead time
All your vendors supply you with a standard lead time. Do you know if that lead time is correct?
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#2 Using only vendor-quoted lead time
Vendor Lead Time
Quoted ActualCopyright Data Profits 2015
#2 Using only vendor-quoted lead time
Vendor Lead Time
Quoted ActualCopyright Data Profits 2015
#3 Using the same lead time for every item
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#3 Using the same lead time for every item
Some items take more time than others for vendors to produce or more time for your distribution center to pick.
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#3 Using the same lead time for every item
Some items take more time than others for vendors to produce or more time for your distribution center to pick.
CAT FOOD
DOG FOOD
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#3 Using the same lead time for every item
Some items take more time than others for vendors to produce or more time for your distribution center to pick.
CAT FOOD
3 DAYS
DOG FOOD
14 DAYS
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#3 Using the same lead time for every item
Some items take more time than others for vendors to produce or more time for your distribution center to pick.
CAT FOOD
3 DAYS
DOG FOOD
14 DAYS
LOST PROFITS!
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#4 Using the same lead time for every location
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#4 Using the same lead time for every location
A truck can only travel 500 miles a day.
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#4 Using the same lead time for every location
A truck can only travel 500 miles a day.
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#4 Using the same lead time for every location
A truck can only travel 500 miles a day.
DC
#1
#2
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#4 Using the same lead time for every location
A truck can only travel 500 miles a day.
DC
#1
#2
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#4 Using the same lead time for every location
A truck can only travel 500 miles a day.
DC
#1
#2
LOST PROFITS!
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#5 Hidden Lead Times
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#5 Hidden Lead Times
Are you factoring in every stop, every touch, every delay?
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#5 Hidden Lead Times
Are you factoring in every stop, every touch, every delay?
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#5 Hidden Lead Times
Are you factoring in every stop, every touch, every delay?
Copyright Data Profits 2015
#5 Hidden Lead Times
Are you factoring in every stop, every touch, every delay?
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#5 Hidden Lead Times
Are you factoring in every stop, every touch, every delay?
LOST PROFITS!
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#6 Poor visibility to actual lead times
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#6 Poor visibility to actual lead times
There is no easy way for you to tell if your lead times are right.
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#6 Poor visibility to actual lead times
There is no easy way for you to tell if your lead times are right.
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#6 Poor visibility to actual lead times
There is no easy way for you to tell if your lead times are right.
Copyright Data Profits 2015
#6 Poor visibility to actual lead times
There is no easy way for you to tell if your lead times are right.
LOST PROFITS!
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#7 Manual lead time input
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#7 Manual lead time input
Even if you can get to the correct information, it’s not easy to update.
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#7 Manual lead time input
Even if you can get to the correct information, it’s not easy to update.
Step Step Step
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#7 Manual lead time input
Even if you can get to the correct information, it’s not easy to update.
Step Step Step Step Step Step
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#7 Manual lead time input
Even if you can get to the correct information, it’s not easy to update.
Step Step Step Step Step Step Step Step Step
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#7 Manual lead time input
Even if you can get to the correct information, it’s not easy to update.
Step Step Step Step Step Step Step Step Step Step Step Step
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#7 Manual lead time input
Even if you can get to the correct information, it’s not easy to update.
Step Step Step Step Step Step Step Step Step Step Step StepLOST PROFITS!
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Even small improvements in the accuracy of your lead times can pay off big in GMROI and top-line sales.
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The best way to fix all these problems is to track and forecastlead times as an integrated part of your demand forecasting or replenishment system.
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iKIS™from Data Profits allows you to easily manage all lead times down to the SKU location while providing comprehensive reporting and customizable automated alerts visible to all stakeholders.
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