What does the term "lead time" refer to in warehousing?

The term "lead time" in warehousing is commonly understood to refer to the total time from order placement to final delivery. This encompasses all stages of the process, starting when a customer places an order with a retailer or supplier and including the time taken for processing that order, picking and packing items, and finally delivering the products to the customer.

By considering lead time in this comprehensive manner, businesses can effectively manage not only the efficiency of their warehousing operations but also customer expectations regarding when they will receive their orders. Understanding lead time helps in assessing the speed and reliability of service, which is crucial for maintaining customer satisfaction and optimizing inventory management.