Tea and coffee businesses achieved biggest reduction in lead times caused by pandemic peak
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Tea and coffee firms have beaten 24 sectors and made the biggest reduction in delivery lead time delays caused by Covid-19, new data has revealed.
Unleashed’s Product Lead Time Index used data from its inventory management software to track how product fulfilment has changed since the start of the pandemic.
According to the index, tea and coffee businesses were the leading sub-sector in slashing its lead times since the most challenging phase of the pandemic, dropping by 61.9% between 2020/21 and 2021/22; reducing lead times from an average of 8.5 days to 3.2.
It was one of the most affected sectors during the peak of the pandemic, with average delivery lead times in 2020/2021 growing by 46.5% since before the pandemic struck.
The analysis of more than 2,500 businesses and 25 different sub-sectors including textiles, IT and plastics shows which ones experienced the most severe shortages during the Covid-19 crisis – and which recovered fastest as it subsided.
The sub sectors with the biggest reduction in lead times since the height of the pandemic are:
|
Sub-sector |
Percentage drop in product lead time between (20-21 and 21-22) |
|---|---|
|
Tea and coffee |
61.91% |
|
Plastic and rubber products |
52.80% |
|
Animal products |
45.97% |
|
Health, medical supplies and equipment |
45.18% |
|
Confectionary |
40.96% |
Lead time is defined as the amount of time between when a purchase order is placed to replenish products and when the order is received in the warehouse. These times can vary between suppliers, where typically the more suppliers involved in the chain, the longer the lead time is likely to be.
Commenting on the findings, Stephen Jones, regional manager UK & EMEA at Unleashed, said:
“Global supply chains are complex, and while the market has been more uncertain than usual, our data suggests that suppliers are working hard to build resilience. In fact, for many, the crises have only strengthened their resolve. Given how much lead times have dropped in some sub-sectors, their efforts are clearly paying off.
“Keeping a tight rein on inventory is essential at any time but particularly during periods of disruption. When product lead times are fluctuating, the right technology can quickly show you the actual vs expected lead times which allows you to manage customer expectations, or look for alternative suppliers who can deliver faster.”
Ben Vear, general manager (EMEA) at coffee company Minor Figures, adds:
“Part of the reason behind these figures is likely to be down to more businesses across the food and beverage industry moving towards a just in case model of stock control and this has been key to cutting lead times over the past couple of years despite the obvious challenges.
“We’re holding additional stock, we work to quite a tight tunnel of inventory that we want to keep in stock, and that might be four to six weeks, but when your performance needle is constantly moving, it’s really tough to get a read on what four to six weeks of stock actually looks like. “
For more information about the research, visit https://www.unleashedsoftware.com/blog/revealed-the-sectors-cutting-product-lead-times-fastest.