According to Wunderman Thompson’s The Future Shopper Report 2023, if customers could change one thing about their online shopping delivery, almost half of the consumers worldwide (48%) would want faster delivery. 🚚 It’s no surprise that customers don’t want to wait too long, but from an eCommerce perspective, managing deliveries can be challenging, especially with varying lead times for different products and suppliers. That’s why, in this article, we’ll discuss the strategies to minimize lead time for your eCommerce store. ✨

Lead Time Meaning

Lead time is the amount of time it takes for a product to move through the supply chain from the moment an order is placed until it is received by the customer. 📦  Or simply, it is the journey of a delivery until it’s received by the customer.

Lead time is a significant factor in the supply chain process since it directly affects inventory levels, production schedules, and customer satisfaction. Imagine a Shopify apparel store during the holiday season. If the lead time extends unexpectedly, the store might run out of popular items, missing the critical sales period. This not only impacts the store’s revenue but also damages the brand’s reputation and customer loyalty. That’s why it is important to manage and minimize lead time. To do this better, understanding the factors affecting it is crucial.

Factors Causing to Long Lead Times in eCommerce

🚚 Supplier Reliability and Location Impact Lead Time

As eCommerce stores grow and their product variety expands, they need deals with multiple product suppliers to avoid being out of stock. However, some of these suppliers may have poor time management and do not deliver materials or products on time, causing delays in production and leading to longer lead times. Additionally, if the supplier is located far away, it can result in longer shipping times and, accordingly, delays.

⚙️ Production Delays Increase Lead Time

Issues within the production process, such as equipment breakdowns, shortage of labor, or quality control problems, can lead to delays in fulfilling orders. These delays can also cause longer lead times and decreased customer satisfaction.

📌 Would you like to turn these delays into revenue? You can accept backorders when you are temporarily out of stock. How? Read How Does Backorder Work? and Backorder as a Cash Flow Generator for more information about this feature.

🚢 Longer Lead Times due to Shipping and Customs Bottlenecks Extend

Shipping delays may happen because of port congestion, customs clearance procedures, or unexpected transportation disruptions. Customs bottlenecks can lead to significant delays when packages are controlled or processed. Such delays can extend the lead time for eCommerce orders.

Since we understand the reasons behind eCommerce's longer lead times, let’s explore effective methods to minimize them.

Effective Ways to Minimize Lead Times

There are several ways to manage the supply chain process better and minimize lead times accordingly.

Forecast demand to reduce lead time

Making precise inventory plans for your eCommerce store streamlines the supply chain process and increases efficiency. It enables your store to adapt flexibly to fluctuations in demand in the future. The key to achieving this is through demand forecasting. For example, a Shopify apparel store can use seasonal demand forecasting for the upcoming end-of-season to ensure that the right products are available to meet demand and can be quickly delivered to customers.

Optimize relationships with suppliers for reduced lead time

Choosing reliable suppliers to systematically meet delivery expectations is the first step to optimizing lead time. In addition, building transparent communication with suppliers helps you to gain inventory visibility during the supply chain process. In this way, with better coordination and proactive problem-solving, you can minimize lead times in eCommerce.

Diversify supply chain sources for faster deliveries

Relying on a single supplier can cause delays if that supplier experiences issues. By diversifying and using multiple sources, you can:

• Have a steady supply of products,
• Negotiate for better terms and prices,
• Have flexibility to respond to market changes and demands,

…and, accordingly, minimize lead times for your eCommerce store. If one supplier faces a problem, you can quickly pivot to others to maintain the flow of goods. This reduces the stockout risk and helps you deliver the products conveniently on time.

Optimize freight planning to minimize lead time

An essential aspect of reducing lead times is optimizing your freight planning. Fabrikatör’s Freight Planner helps you make informed decisions about shipment methods, balancing speed and cost. The tool calculates the best distribution between faster air freight and slower ocean freight, based on factors like manufacturing time and forecasted stockout dates. With this tool, you can reduce lead times for urgent items and save on freight costs.

Use Technology and Automation Tools!

📊 Real-Time Tracking and Analytics

Real-time tracking and analytics allow your eCommerce business to continuously monitor up-to-date inventory levels, shipments, and delivery times. Having constant access to this data helps you to identify and address potential delays and ensure that products are available when needed. This proactive approach helps in minimizing lead times and improving overall operational efficiency.

📌 Do you use Excel for tracking your inventory as a growing eCommerce business? Your tracking process may not be as efficient as you hope. You can read ‘’How to Keep Track of Inventory in Excel?’’ and ‘’From Excel to Fabrikatör: Transform Your eCommerce Inventory Management ’’ for more details.

🤖 AI and Machine Learning in Predicting Lead Times

Benefiting AI and machine learning tools in analyzing historical data and trends is necessary for more comprehensive and reliable demand forecasting. In this way, you can determine possible disruptions in the supply chain before and optimize inventory levels accordingly to eliminate stock issues. This proactive capability helps you make more reliable plans, reduce lead times, and increase customer satisfaction.

📌 How can you use AI and machine learning techniques when forecasting? Read Demand Forecasting in eCommerce for more detail.

🚀 Inventory Management Software

Using an inventory management software is a method including real-time inventory tracking, comprehensive demand forecasting, error-free data analytics, overall inventory efficiency, and more. Of course, only if you choose the the right software for your eCommerce store’s needs. Such solutions provides you a clear inventory visibility 👀 to see stock levels and supplier performance so that you can optimize your inventory process and shorten lead time. Well, but, which software would be the best fitting solution for you? It’s Fabrikatör!

Minimize eCommerce Lead Time with Fabrikatör!

Fabrikatör is here to help you optimize your inventory management process, negotiate better deals with suppliers, minimize lead time, and earn more! 🚀 With Fabrikatör’s advanced features and a user-friendly interface, you can eliminate inventory challenges of a growing eCommerce store. ✨

With the 5/5-rated Fabrikatör, you can immediately automatize and fasten your inventory management process! Here is a glimpse of what you can achieve with it:👇

📊 Gain actionable insights to make more reliable inventory decisions,

📝 Create purchase orders in seconds,

🚨 Receive notifications for low stock levels and restock your stock on time,

📦 Accept backorders and keep generating revenue when your eCommerce store is temporarily out of stock,

📈 Make sales forecasting and prepare your inventory wisely,

🚚 Improve your shipping strategy and reduce unnecessary costs with Freight Planning!

Do you have questions about Fabrikatör or just want to learn more? In only 30 minutes, you can see Fabrikatör in action!

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