Home >> Uncategorized >> Four Leads On The Lead-Time Quagmire

Four Leads On The Lead-Time Quagmire

Suppliers representing four material handling categories—industrial trucks, general lines, storage & handling and engineered systems—describe how they are dealing with lead-time challenges and what their companies are doing to help distributors get product in a more timely way.

“When TGW commits to a ship date, we make it our goal to ship on time. Daily production meetings update order schedules, and if it looks like we have a problem, we revise the ship date. We never mislead about lead times. If something will be longer than expected, we give the facts. We monitor closely the lead times for materials from our own suppliers, and we make sure to stock the items that could cause longer leads with our customers. Currently, we are at three to four weeks for standard equipment, six to eight weeks for special equipment. I don’t expect much to change for the rest of 2011. We are flexible with our schedule, and we tell our distributors never to lose an order because of lead time.”

Jim Bronsema
Jim Bronsema
Director of Distributor Sales, TGW

Hubert A. Schlegel
Hubert A. Schlegel
Director of Marketing, Wildeck

  “Lead times vary by product. Some standard products ship within days; a standard mezzanine ships within two weeks, but a custom-design takes four to six weeks. It’s important to understand that on custom-design products, lead times start after receipt of approval drawings. It all boils down to frequent communication, trusted relationships, and getting those approval drawings signed as quickly as possible. Lead time is stated on quotations, reiterated at the time of order receipt, and again when approval drawings are received. We attempt to be flexible, but if the customer perceives the lead to be too long, we look for any possible way to shorten it. We level with our distributors/dealers and communicate the reasons for the timing, even if it’s not what they want to hear.“I don’t think our customers expect us to stock more product. With a skilled workforce and well-maintained production equipment, we can meet or beat delivery expectations without building up an excess inventory of finished goods. Like many manufacturers, we are committed to lean throughout the company, not just the manufacturing process. We’re looking at all processes and doing whatever we can to avoid duplication, enhance workflow and eliminate wasted time. The goal is to keep our lead times low and customer satisfaction high. We do not anticipate any change in project lead times this year.”
“A majority of products are currently in stock, though custom takes about four weeks. We’re trying to improve this time by adding a second shift. And we now paint on both shifts instead of one. Lead time is always discussed during the quoting process, so customers realize up front whether it’s something we have in stock, if it’s in production, or if it will be made from scratch, and then it could take up to four weeks. If a customer has a strict deadline, perhaps product is needed on the ground for a building occupancy permit or an invoice is required within a certain time frame, we do what we can. If there is a long delay, reps can assist the distributor with the end-user call. We do a lot of planning with our suppliers so we’re not caught short waiting for materials.”

Dan Gentile
Dan Gentile
President, “Save”ty Yellow Products

Kent Eudy
Kent Eudy, Vice President–Sales & Marketing
Mitsubishi Caterpillar Forklift America Inc.

  “While it varies by model and source plant, MCFA lead times have been extended since the middle of the fourth quarter 2010 when industry orders began to accelerate, while the supply chain has not been able to ramp up as quickly. This causes dealers and end-users to hedge by ordering safety stock, which further exacerbates the situation. Model availability reports are online and updated weekly. Lead times can change very quickly. Availability report estimates are provided to dealers based on the next order. If the factory quotes eight weeks for a quantity of two units of a specific configuration, yet the actual order comes in for ten units, the availability of units three through ten could jump by many weeks, depending on the material lead times. Published lead times should always be verified with a factory representative, who can communicate directly with the manufacturing schedulers for a more accurate quote of lead times.“The better the forecasting process, the easier it is to plan the supply chain. Shorter lead times require a very accurate sales forecasting process, which is never going to be good enough. If the market outperforms the forecast, then lead times go out. This was the case in the first and second quarters of 2011. Most manufacturers are now producing at a rate that will meet the demands of the third and fourth quarters, so lead times should stabilize. That said, I believe manufacturers in general will be cautious about falling into an overcapacity situation.”

Material Handling Equipment Distributors Association