Lead time in inventory management is the amount of time between the placement of an order and its receipt. It is an important metric that helps businesses understand how long it will take to replenish their stock, thereby ensuring an uninterrupted supply of goods to meet customer needs. It also helps them plan out future orders so they can maintain optimal levels of inventory without overstocking or running low on certain items. Therefore, lead time in inventory management is crucial for enabling businesses to run efficiently and effectively.