Subject: SPKH: What is Your Dock-To-Stock Time?

What is Your Dock-to-Stock Time?
Issue #151
Hi Friend

One of the most important aspects of spare parts inventory management, in fact any inventory management, is the lead time. Lead time has a major influence on how much stock you hold.

Lead time is one of two key factors in determining your cycle stock quantity.
Lead time variability is one factor impacting your safety (or buffer) stock quantity.
Lead time has a major influence on your re-order quantity.
Lead time is a influential factor in determining spare parts criticality and the associated risk management.

Understanding lead time is very important and it’s no wonder that there are so many discussions on lead time. But why is it that lead time and the elements that make up lead time are so misunderstood?

Visit any online forum, such as the SparePartsKnwoHow.com LinkedIn group, and you will find questions on lead time. In my work I am constantly asked to clarify the elements of lead time. Most of these enquiries are seeking validation that the actual lead time for a spare part is more than the time quoted by the vendor. Well, of course it is!

The lead time is made up of all of the actions and delays that occur between when the item reaches the re-order point to when it is restocked. The processes will be different at different companies but, as a generalization, lead time includes: the time it takes to realize that the ROP has been reached, the time to advise procurement to repurchase, the time to place the purchase order, the time for the vendor to deliver and the time to restock the item both on the shelf and in your system. This last time element is often referred to as the ‘dock-to-stock’ time.

In my experience this is usually the most overlooked component of lead time.

It is often considered that once a part is delivered to site that… 

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Keep on improving,

Phillip Slater
Founder, SparePartsKnowHow.com


Phillip Slater
Founder, SparePartsKnowHow.com
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