Changing lead time calculations for storerooms

Lead time is the time between when an item is ordered and received. To analyze vendors and determine when to reorder items, you can change how lead times are calculated.

Procedure

  1. In the Storerooms application, select a storeroom.
  2. In the Recent Lead Time Weight in % field, enter a value. You can specify different lead time weights for different storeroom locations.
  3. Save your changes.

Results

When you change this calculation, the weight in percent used for the current inventory lead time is automatically considered 100% minus the value in the Recent Lead Time Weight in % field.

Example

For a storeroom, the Recent Lead Time Weight in % is set to 20%. A quantity of 100 items is ordered, for which the item has an existing lead time of 30 days. The entire shipment is received in 20 days (recent lead time). The inventory item's lead time recalculates based on the recent receipt of the item as follows:
0.20 (20 days) + 0.80 (30 days) = 28 days
28 days become the recalculated lead time for the inventory items. When the item is reordered, 28 is the value for inventory item's existing lead time.