Throughput time

By actively working to reduce throughput time, you can reduce unnecessarily long lead times and increase your company's competitiveness and flexibility. In this article, we'll go through what you need to know about throughput time and how to calculate it.

What is throughput time?

In e-commerce, throughput time is a measure of the total time from the time a product is manufactured or purchased to the time it is delivered to the end customer. It allows entrepreneurs to assess how efficient their logistics flows are and whether there are any elements that can be improved to reduce throughput time. The aim of reducing throughput time is to optimise the use of the company's resources and thereby increase profitability.

How to calculate throughput time

When calculating the throughput time of an order, you need data on queue time, set-up time, production time and transport time. Usually you will find this information in the basic data register of your business system. So you need to know when the orders were placed, how long it took before the product could be shipped, the set-up time in between and the actual transport time. To get the total throughput time, add up the different categories.

How Postnord can help you reduce throughput time

Do you need to produce data to calculate the throughput time of different orders or find smooth delivery options that reduce transport time? As a Postnord contract customer, you get access to Portal Business – a platform that makes it easier for you to streamline your delivery workflows. It gives you a good overview of all deliveries and where they are, making it easy for you to quickly calculate the queuing, placement and transport time for a particular order. In the portal we also compile ongoing reports that allow you to make decisions based on facts and not emotion.

All you have to do to get started is become a contract customer, it's free and only takes a few minutes.

Want to read more similar articles? Click through to the Logistics collection page.

Frequently asked questions about throughput time

What does throughput time mean?

Throughput time is a measure that describes how long it takes from the time a product is manufactured to the time it is delivered to the customer.

What role does throughput time play in e-commerce?

By reducing throughput time, operations become more flexible, cost-effective and competitive.

What elements are included in the throughput time?

The exact elements included in the throughput time vary between operations, but some examples are transport time, set-up time, queuing time and production time.