APICS Certified In Planning And Inventory Management (CPIM) Exam 1 Practice

Manufacturing lead time is the total time inside the factory to convert raw materials into finished goods, starting when a production order is released and ending when the finished product is ready for inventory or the next step. It includes all internal steps such as setup, processing, assembly, inspection, and any waiting or material handling that occurs within the plant. It does not include time spent acquiring materials from suppliers (procurement lead time) or delivering the finished product to the customer (delivery lead time). For contrast, cycle time is the actual time to complete the processing of a unit through the operations, while procurement lead time and delivery lead time refer to external stages: obtaining materials from suppliers and shipping to customers, respectively.