Sizing Safety Stock Against Real Supplier Lead-Time Variability
A distributor sets safety stock from nominal supplier lead times published in the ERP, which bear little relation to actual delivery performance.
Run on Sanchay · Supply Chain Resilience
The challenge
Nominal lead times understate real variability, so safety stock is systematically too low for unreliable suppliers.
Reliable and unreliable suppliers are buffered identically, tying up capital where it is not needed.
Nobody measures delivered lead time, so the nominal figures are never challenged.
How Sanchay solves it
Delivered Lead-Time Measurement
Actual order-to-receipt times are measured per supplier and per SKU rather than taken from the ERP field.
Variability Profiling
Each supplier's reliability is profiled as a distribution, not a single number.
Differentiated Buffering
Safety stock is sized against each supplier's measured variability, so reliability is rewarded with less buffer.
Supplier Feedback
Measured performance is made available for supplier conversations and contract review.
Continuous Recalibration
Buffers are recalculated as supplier performance changes rather than annually.
The outcome
Safety stock sized against measured rather than nominal lead times.
Working capital released where suppliers are demonstrably reliable.
Supplier performance measured and available for contract discussions.
Representative scenario: a modelled industry situation showing how this accelerator applies. Figures are projections, not a named client result.
Capabilities used
Every accelerator is assembled from the same capability layer, so a workflow you adopt here shares its foundation with the rest of the portfolio.
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