Logistics Key Performance Indicators

Logistics KPIs

Logistics KPIs

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Logistics Key performance indicators or metrics are a measurement, based on performance which is used by logistics managers to analyze, track and visualize relevant logistics processes efficiently. Some of the most important logistics KPIs and metrics are given below for better understanding and implementation:

1. Order Accuracy

To maintain supply chain efficiency, The Perfect Order Rate is a highly important logistics metric. It measures the number of orders that are processed, shipped and delivered along which are on its way. The shipping time should be respected as well as the delivery time. This process can provide us more leads with more satisfied clients.

2. Shipping Time

Shipping performance always refers to the ratio of orders which are shipped on divided by the total orders. If the planning processes are outdated or execution systems are slow, it can create issues. So, they need to be found before an unexpected event occurs.

3. Delivery Time

The Delivery is measured from the beginning of the order is placed to the moment it is delivered. if we can measure the delivery hours, it is better for the customers to know when they have to pick the package. That will help us to increase our order picking accuracy rate and also, we can avoid returns.

4. Transportation Costs

In this process, the average transportation costs are calculated based on all expenses involved in the processing of an order. It breaks down the costs related to logistics KPI according to certain categories. This calculation helps us to evaluate if this project is within the budget.

5. Number of Shipments

Shipments are considered as the showcase of any company’s warehouse. The quality and accuracy of the primary order show the quality of our service. We can measure the orders placed ready on time to be shipped divided by the orders shipped out of our warehouse. Through this process, we can have great insights into rush seasons. Also, it will enable us to anticipate and allocate more resources accordingly.

6. Warehousing Costs

Warehousing is called the management of space and time altogether. Here the costs refer to the money allocated to transportation cost. These expenses cover energy costs and equipment like processing the goods, as well as labor costs, shipment/delivery. These measurements can facilitate our overall management and add value to our future aspects.

7. Inventory to Sales Ratio

This measurement includes inventory available for sale versus the actually sold quantity. This performance indicator enables us to face unexpected situations. The carrying cost of inventory can be used with other KPIs to know not only the financial stability of our business.

8. Inventory Accuracy

Inventory Accuracy is one of those most important logistics metrics that can reconstruct our warehouse. If the inventory is inaccurate, it can lead to unexpected backorders and also create unsatisfied customers. A regular inventory checking in the existing issues ensures the smooth flow of business and enables us to spot issues related to accounting, receiving and shipping.

9. Inventory Turnover

This logistics KPI is measured by the number of times the inventory is entirely sold over a certain period of time. It’s a great indicator of efficient production planning, process and marketing/sales management. To exceed the target and make the benchmark for industry average rate, this measurement can be more helpful.

The points mentioned above are the key elements to measure the Logistics KPIs. These measurements are useful for any company to create a number of satisfied customers with the best delivery experience.

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