KPI for Logistics Industry
KPIs or Key performance indicators work with the raw data of an industry to evaluate how the industry performs. It helps unleash the hidden patterns that helps the industries analyze the bottlenecks, which in turn, compels the industries to take preventive measures against such problems. Also, it helps increase the employees’ productivity and the overall industry performance because it helps them assess their current state.
Logistics industry makes use of KPIs to make note of how poorly or how well their industry is performing in the business market. It also helps them figure out where they stand in the market. Logistics industry is responsible for the handling of products or goods in a manner that greatly satisfies the customers. It is a major fragment of the supply chain management.
Just like any other industry, logistics industry also tracks certain KPIs to enhance their growth. Following are the important KPIs to track for the logistics industry:
1. Timely delivery
This is one of the important KPIs to gauge for a logistics industry. It is vital for the supply chain team to produce their goods right on time to the clients or consumers to avoid the load of fees related issues.
By tracking the on-time delivery of the goods, logistics industry helps the consumers to consider the industry as reliable which is always good for the logistics industry. This helps enhance the performance of the logistics industry by a great amount.
2. Price per pounds
This is another important KPI that helps the logistics industry to keep track of the financial condition of their customers. It helps the customers to buy the products for the right amount without having them to pay extra for anything.
Price per pounds refers to the total amount of cost divided by the weight in pounds. Hence, tracking this KPI is very helpful when it comes to proper money management.
3. Accuracy of the orders
In a logistics industry, large number of orders gets placed on a day to day basis as it is a part of the supply chain management. These orders are sent right on time and in the best way possible for the effective management of the logistics industry.
Order accuracy refers to how accurately orders could be filled in a given time slot. It is quite doable for the logistics industry to fulfill large number of orders within a given slot of time but what is desirable by the managers is how well and accurately could the logistics industry get these orders filled. Hence, measuring this KPI is very important for the logistics industry to drive effective and profitable results.
4. Timely Shipping
Just like timely delivery, timely shipping is another KPI that is very crucial for the logistics industry. Timely shipping refers to the shipping of the goods from the warehouse on the right time. If the goods are shipped on the right time, then they also get delivered on the right time.
Also, on-time shipping helps logistics industry in proper financial management. If shipping is not done on the right time, then the chances of shipment getting delayed becomes high and sometimes, it even gets lost in the way, which causes the logistics industry to spend more money in delay and late fee charges. So to maintain the productivity, this KPI is calculated by the logistics industry.
5. Accuracy of the inventory
Inventory refers to the list of all the goods produced which are later sold to the consumers. These goods vary from pure raw goods, work in progress goods, to finished products which are ready for selling purposes. Inventory management is also very important for any industry to maintain their effectiveness in terms of their working capacity. Inventory accuracy is another very important metric to measure for the logistics industry. It refers to the accuracy of the supply chain personnel or the warehouse staff to manage the orders booked in the right manner.
It is very central for the logistics industry to make sure that the orders filled at the warehouse get sent to the right customers. When the right order gets sent to the right customer then it avoids the case of spending extra money in fees and other charges that are usually incurred to direct the order to the right destination. We all know how annoying it is when the wrong product reaches our way, so by keeping track of this KPI, logistics industry makes sure that their operational efficiency is not getting compromised.
6. Dock to stock inventory
Dock to stock refers to the procedure where the goods are directly delivered to the storage house without requiring the usual inspection while delivering the goods. This is also one of the prime metrics to calculate for the logistics industry. It helps the logistics industry to make sure that the inventory is filled with the products in a proper way, so that goods are available when ordered. Dock to stock is one of the best practices of manufacturing in the business market.
So those are all the prime KPIs to measure for the logistics industry. It helps add value to the business and enhances the progress of the industry.