You need to consider many factors to make sure you obtain scheduled delivery on time. When suppliers make a bid they usually give the date when they expect to make delivery. When the material in question is urgently needed buyers may place the business with a particular supplier based primarily on the supplier’s expected delivery date.

Suppliers usually forecast the expected delivery date conscientiously, but they may not do their calculations carefully enough. They may not consider outside variables that they have little, if any, control of. Therefore, it is prudent for buyers to do some calculations of their own.

Actual leadtime is made up of a number of time increments. Preliminarily, there is the time for the purchasing function to process the order after receiving the requisition. There is the time to deliver the order to the supplier, either by regular mail or by electronic method.

The supplier’s leadtime begins after delivery of the order. First the order must be processed. Any required supplier inventory or raw material must be ordered and received. The time for any required manufacturing must be added. Too many suppliers stop making their calculations at this point. They may not have included any time for transportation for any ordered material. They often submit their bids without including the time for transportation to their customer. They assume delivery is made once the order is shipped.

Buyers should make sure that suppliers understand that their responsibility for delivery lasts until the goods are actually delivered to the buyer’s facilities.

There is always a risk of delay because of various factors. A work stoppage due to labor problems is a possibility. Another potential problem is equipment failure that delays completion of items needed. A supplier’s financial problems may prevent or delay acquisition of inventory.