How to reduce lead time in manufacturing: 5 top tips
Want to learn 5 top tips for how to reduce lead time in manufacturing? We’ve thought carefully about how these can be improved. Simply read on for more…
It is a basic truth of business that customers don’t like waiting. Whether the customer is waiting for a bill in a restaurant or for their online purchase to arrive through the post, getting the item to them on time is a key part of building customer satisfaction.
This is no different within the world of manufacturing, where the scope for delay can do more damage than being a minor irritant to a single customer.
Waiting builds frustration with the client but can also have knock on effects. The complexity of modern day supply chains means that a single delay can impact multiple businesses and thousands of people.
The recent pandemic has highlighted multiple examples of when delays have serious consequences.
With this in mind, it’s no wonder that you’re looking for ways to reduce lead times with the help of ERP.
ERP systems specialise in reducing waste and fine-tuning processes that produce a range of benefits – one major plus point is the opportunity to reduce lead times.
Here are 5 top tips for how to reduce lead time in manufacturing.
Choose a domestic supplier
Globalisation offers businesses the chance to work with suppliers from around the globe. While this can work out cheaper in many cases, it does increase the chance for lead times to become delayed and for customer frustration to build.
Supplies from certain parts of the world can take weeks to arrive, while language barriers add another layer of complexity.
By staying closer to home, you simplify these processes and reduce the risk of delay.
A classic error in business is ordering too much stock. While the temptation is to order in bulk to save money, you may be surprised to hear that this is rarely borne out in reality.
Large orders have unintended consequences, as the additional inventory management capacity needed to store the excess goods often leads to higher labour costs.
For some goods, it is possible that the stock on shelves is depreciating in value the longer it goes unsold.
Then there’s the fact that unsold stock is tying up capital that could be used elsewhere in your business.
To avoid this, increase order frequency. In doing so, your business will be more responsive to unpredictable challenges and reduce carrying costs.
Give frequent sales forecasts
Your ERP system provides you with the data you need to make sales predictions by building up a picture of how long it takes items to be sold once they are delivered.
Providing suppliers with regular sales forecasts not only improves your relationship with them but also allows them to better anticipate your needs and speed up the fulfilment process.
Consolidate and streamline your suppliers
Try to reduce the number of backup suppliers that you use if you can. Although having a backup ready in case of unforeseen problems is good practice, keeping multiple suppliers on the go at once, with multiple purchase orders and relationships to keep on top of, can lead to longer lead times.
Consolidating suppliers can produce surprising gains if done correctly.
How to improved lead times in manufacturing? Communicate!
Staying in touch with your suppliers is about more than just courtesy – it can massively improve lead times.
You’ll find that suppliers are more motivated if you keep them updated with your requirements and objectives that have been met.
Providing them with clear and consistent information is a simple way to ensure routine challenges are met with minimal fuss.
Are you intrigued to learn more? Our ERP experts can help you get the most from your current system or guide you to a successful ERP implementation. Simple click here to get in touch.
Write a comment