What is Inbound Order Cycle Time?
Inbound order cycle time is the duration from the placement of a purchase order with a supplier to the receipt of goods at the warehouse.
How to calculate Inbound Order Cycle Time?
Inbound Order Cycle Time = (Time goods are received - Time purchase order is placed) / Total number of orders
What is the business impact of Inbound Order Cycle Time?
Reducing inbound order cycle time can improve inventory management, reduce stockouts, and increase order fulfillment throughput.
Industry benchmark for Inbound Order Cycle Time
Varies by industry, but strive to minimize cycle time without compromising on quality or incurring excessive costs.
How to improve Inbound Order Cycle Time?
- Automate Purchase Order creation and replenishment process.
- Improve inventory planning with demand forecasting
- Monitor and streamline carrier and freight provider performance for on-time delivery.