In the sector of garments business, the exporters get lead time from buyers end for delivery completed garments. Most of the time the buyer gives settled lead time for their orders or offer the suppliers to choose most ideal lead time and mutually they agree at a date for shipment.
Shipment lead time may differ on the basis of exports orders volume and product offering.
- Lead time in export sector
It is the time term from accepting an order to delivery to the buyer. Typically the date of loading from the factory is considered as shipment date. Lead time is communicated in number of days.
For example, if a manufacturer got a order on first of July, 2013 and buyer requested to ship the order on 31st October, 2013. Here order lead time is 30(July) + 31(August) + 30(September) + 31 (October)days = 122 days.
Lead time estimation
The buyer should not mention the lead time to the supplier before order confirmation. Rather they request that supplier ascertain and propose a lead time in view of order quantity, process time and production capacity of supplier, improvement time and material sourcing time.
At that situation, how a supplier would figure out the lead time of an export order has been discussed in below:
Step#1: Note down the procedures and occasions you have to do to complete the order.
The most ideal approach to do this is by setting up a Time and activity calendar (TNA). TNA layout would help you rapidly make the action list and ascertain the lead time. Suppliers must have the holiday list of his country and buyer’s country as well.
Step#2: Calculate process time for all procedures.
Supplier have to know processing time for preliminary work, sourcing material for examining and mass, inspecting, endorsements, production, quality control, finishing, final inspection etc. Compute the estimated time of every procedure for the given order. Consider the process time to discover lead time of individual procedures. While determining the number of days required for an individual procedure, bear in mind to include the following issues: process start-up time, weekly holidays, holidays in the middle of process etc.
Sometimes the processes which are involved with outside party (lap dip, wash, printing) then the supplier should take extra lead time for these processes.
Step#3: Consider lead time for different materials sourcing from supplier.
Take responsibility from supplier for material supply. Manufacturer requires few days for approval of fabric before beginning mass cutting.
Step#4: Identify basic process for the given orders.
Identify basic way for all procedures of manufacturing. This is essential to identify which all procedures should be possible parallel and which all procedure can’t be begun without finishing previous procedure. Consider covering of different procedures and dealing with various procedures in the same period. By following these lead time can be reduce.
Step#5: In the TNA date-book note the start and expected finish date of all procedures.
In this way we will get finishing and packaging date of the order. We can reduce production lead time by starting early production. For example, if cutting department requires 5 days for cutting procedure, then we can begin production in the same day or following day of cutting begin. At the same way, if it will take 10 days to stitch, then we can begin finishing procedure after completion of stitching of full part of the garments without waiting to complete sewing for whole order. By applying this way we can reduce lead time.
Step#6: Calculate Lead time
We have order placing date, production and finishing date. Consider the dates from one process to another process and note down the days. Check days required to reach from one occasion to next occasion and stamp dates for every occasion. Arrange start and finishing date of all procedures taking after essential process.
To find out the accurate time period of the order, count the days from the date of order placing to shipment date. By this we will get the lead time any order.