Main KPIs for supply chain monitoring
According to research conducted by Insider Intelligence, global e-commerce will exceed $8 trillion by 2027, with sales volume accounting for 23% of the total. Therefore, for e-commerce, SMEs and artisans operating in the online market, knowing what the key indicators are is essential to be able to optimize your operations, reduce costs and make your business more sustainable and competitive.
Here is a list of some of the most relevant supply chain KPIs, divided by area.
Logistics and transport
KPIs in logistics are crucial to ensuring the efficiency and punctuality of deliveries. Among the main indicators, we find:
Perfect Order Rate: this measures the percentage of orders that were fulfilled completely and without errors, i.e. orders that were accepted, processed and delivered without incident. This KPI is important for evaluating a company's ability to provide services to customers efficiently and satisfactorily.
On-time Delivery Rate: this indicates the proportion of orders delivered within the expected deadlines and without delays. A high value in this KPI is crucial to maintaining customer trust.
Transit time: this indicates the time between the shipment of an order and its delivery. It is vital for measuring the effectiveness of transportation processes.
Delivery cost: this analyzes the total cost of each shipment, including transport, labor and packaging materials and provides useful feedback to keep spending under control.
Goods damage rate: this measures the percentage of products that suffer damage during transport, which is fundamental for evaluating the quality of the transport service.
KPI for warehouse control
KPIs in the supply chain also offer useful indications regarding correct management of the warehouse as they help to optimize spaces and guarantee the effectiveness of storage and retrieval processes:
Accuracy of inventory: Inventory accuracy reflects the correspondence between the data in the storage records and the actual quantity of products in the warehouse. A high level of accuracy reduces the risk of overstocks and stock outs, thus improving the ability to respond to market demands.
Return Rate: It measures the percentage of returned products compared to the total orders shipped. It is a direct indicator of customer satisfaction and product quality.
Storage cost per unit: This supply chain KPI calculates the cost of holding each unit in inventory and is invaluable in keeping costs under control.
Inventory rotation cycle: the frequency with which the inventory is completely renewed. A rapid cycle, characterized by short inventories, is indicative of good inventory management.
To best manage supply chain KPIs, it is essential to be able to count on integrated and automated management of all phases of the process, from the moment an order is registered online to delivery of the product to the end customer. To do this, it is necessary to be able to count on an intelligent warehouse that uses advanced technologies such as inventory software and automated systems capable of providing staff with precise information on picking and packing and the movement of goods. Automation and the integration of digital technologies allow not only to reduce human errors but also to speed up processes, thus reducing waiting times for customers and increasing the company's ability to respond to fluctuations in demand.
Furthermore, the importance of integrated information systems also extends to the real-time monitoring of shipments, delivery of the inverse logistics, which deals with customer returns. These systems allow each product to be tracked along the supply chain, thus improving visibility and allowing rapid interventions in case of deviations from expected plans.
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