Purchase Order Lead Time Definition

When a company purchases goods or services from another company, the amount of time that elapses between the placement of the order and the receipt of the goods or services is called the purchase order lead time. The purchase order lead time can have a significant impact on a company’s inventory levels, cash flow, and customer satisfaction.

There are several factors that can affect the purchase order lead time, such as the complexity of the product or service being ordered, the Lead Time Definition supplier‘s production schedule, shipping times, and customs clearance.