Logistics KPIs, Metrics & Benchmarks

KPIs & Metrics to Measure and Manage Logistics Performance

Logistics

What are Logistics KPIs?

Logistics is the brain of the supply chain – involving the coordination of various functions, including procurement, warehousing, order management and transportation, to ensure that goods flow efficiently from point-to-point to meet customer demand. Logistics KPIs focus on measuring the timeliness, efficiency, quality and accuracy of customer order fulfillment. This can include analyzing the entire order fulfillment process, from procurement through last mile delivery.

Using Logistics Metrics to Improve Supply Chain Efficiency & Service Levels

Logistics metrics typically focus on three major, high-level aspects of the supply chain: warehousing, transportation and delivery. Logistics analytics and data modeling can become quite complex, combining demand forecasting, route optimization and cross-docking scenarios, among other things. There are, however, many straightforward KPIs that can be used to measure the effectiveness of the logistics function (read more about those below). For example, a supply chain executive may want to use KPIs to answer some very simple questions. Are orders being delayed due to supply issues? How much does each order cost to fulfill (per pound, per mile)? Are orders being delivered on-time and in-full?

KPI's & Data 

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Management and Overhead Expense per Case

The total distribution overhead and management-related expenses (salaries, equipment, etc.) incurred by the company divided by the number of cases or pallets delivered over the same period o...

KPI Type : Cost

Formula : Total Management-Related and Overhead Expenses Incurred / Number of Cases or Pallets Delivered

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Order Shipment Cycle Time

The number of hours required to process a customer order, from the time when the order is placed until the time the order is shipped by the supplier.

KPI Type : Service

Formula : Sum of Time to Ship Customer Orders / Total Number of Customer Orders Shipped

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5 Simple Logistics KPIs to Start With

There are many leading indicators that combine to impact bottom line logistics performance. The logistics value chain begins with demand planning and ends with final delivery – and each link in the chain can have a domino-like effect on others. But from a high-level perspective, logistics metrics are simple – they measure efficiency and service levels surrounding customer order fulfillment. You can start simple by measuring these 5 KPIs, then drill-down from there:

  1. 1.Customer Backorder Rate
  2. 2.Inventory Accuracy
  3. 3.Inventory Turnover (by Category, SKU)
  4. 4.Transportation Cost per Mile
  5. 5.Perfect Customer Order Rate

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KPI's & Data 

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Management and Overhead Expense per Case

The total distribution overhead and management-related expenses (salaries, equipment, etc.) incurred by the company divided by the number of cases or pallets delivered over the same period o...

KPI Type : Cost

Formula : Total Management-Related and Overhead Expenses Incurred / Number of Cases or Pallets Delivered

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KPI's & Data 

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Order Shipment Cycle Time

The number of hours required to process a customer order, from the time when the order is placed until the time the order is shipped by the supplier.

KPI Type : Service

Formula : Sum of Time to Ship Customer Orders / Total Number of Customer Orders Shipped

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KPI's & Data 

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Undamaged Supplier Shipment Rate

The total number of orders received from suppliers without any damage divided by the total number of supplier orders received over the same period of time, as a percentage.

KPI Type : Quality

Formula : (Total Number of Undamaged Orders Received / Total Number of Orders Received) * 100

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KPI's & Data 

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Supplier Order Documentation Accuracy Rate

The total number of supplier orders received with complete and correct documentation (invoice, ASN, packing slip, etc.) divided by the total number of supplier orders received over the same...

KPI Type : Quality

Formula : (Number of Supplier Orders Received With Correct Documentation / Total Number of Supplier Orders Received) * 100

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Proof of Delivery Rate

The number of shipments that were completed with a signed proof of delivery (POD) form (paper or electronic) divided by the total number of deliveries completed over the same period of time,...

KPI Type : Quality

Formula : (Number of Shipments Signed / Total Number of Shipments Completed) *100

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Undamaged Customer Order Rate

The total number of customer orders that are shipped in good condition divided by the total number of customer orders shipped over the same period of time, as a percentage.

KPI Type : Service

Formula : (Number of Customer Orders Shipped in Good Condition / Total Number of Customer Orders Shipped) * 100

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KPI's & Data 

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Perfect Customer Order Rate

A composite score calculated by multiplying average on-time delivery rate, complete shipment rate, undamaged shipment rate and correct documentation rate for a certain period of time or grou...

KPI Type : Service

Formula : On-Time Customer Order Delivery Rate * Complete Customer Order Rate * Undamaged Customer Order Rate * Percentage of Customer Orders with Correct Documentation

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KPI's & Data 

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Percentage of Customer Orders with Correct Documentation

The total number of orders received by customers that contain accurate documentation (invoice, ASN, packing slip, etc.) divided by the total number of orders received by customers over the s...

KPI Type : Service

Formula : (Number of Orders Sent to Customers with Correct Documentation / Total Number of Orders Sent to Customers) * 100

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On-time Shipment Readiness

The total number of orders picked, packed and ready for shipment by the designated shipping time divided by the total number of orders shipped over the same period of time, as a percentage.

KPI Type : Quality

Formula : (Total Number of Orders Shipped by the Designated Time / Total Number of Orders Shipped) * 100

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KPI's & Data 

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On-time Supplier Delivery Rate

The number of orders received from suppliers on or before the committed delivery date divided by the total number of orders received from suppliers over the same period of time, as a percent...

KPI Type : Quality

Formula : (Total Number of Orders Received from Suppliers On Time / Total Number of Orders Received from Suppliers) * 100

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KPI's & Data 

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Customer Order Fill Rate

The total number of customer orders that are shipped with all agreed upon lines/units divided by the total number of customer orders shipped over the same period of time, as a percentage.

KPI Type : Service

Formula : (Number of Customer Orders Filled Completely / Total Number of Customer Orders Shipped) * 100

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KPI's & Data 

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Distribution Center Expense as a Percentage of Revenue

The expense incurred by a company's distribution center (e.g., expense focused on receiving shipments, warehousing, sorting, inventory control, picking, etc.) divided by the total dollar amo...

KPI Type : Cost

Formula : (Distribution Center Expense Incurred / Total Company-Wide Revenue Generated) * 100

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KPI's & Data 

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Customer Order Line Item Fill Rate

The total number of order lines filled completely as requested by the customer divided by the total number of customer order lines filled over the same period of time, as a percentage.

KPI Type : Service

Formula : (Number of Customer Order Lines Filled Completely / Total Number of Customer Order Lines Shipped) * 100

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KPI's & Data 

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Percentage of Backorder Dollars

The total dollar value of orders delayed in shipment due to the company being out of stock divided by the total dollar value of orders placed over the same period of time, as a percentage.

KPI Type : Service

Formula : (Dollar Value of Orders Delayed in Shipment / Total Dollar Value of Orders Placed) * 100

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KPI's & Data 

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Percentage of Backorder Lines

The total number of customer order lines delayed in a shipment due to the company being out of stock divided by the total number of order lines processed over the same period of time, as a p...

KPI Type : Service

Formula : (Number of Order Lines Delayed in Shipment / Total Number of Order Lines Processed) * 100

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KPI's & Data 

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Stocking Cycle Time (Dock-To-Stock)

The number of hours required to properly store materials or goods, from the time the materials/goods are received from the supplier until the time they are stored and recorded in inventory m...

KPI Type : Service

Formula : Sum of Time to Stock Incoming Shipments / Total Number of Shipments Received

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Revenue per Driver

The total revenue earned by the company divided by the average number of drivers employed by the company over the same period of time.

KPI Type : Revenue

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Revenue per Tractor

The total dollar amount of revenue earned by the company divided by the average number of tractors (vehicles that pull trailers/cargo units) being used by the company (includes tractors eith...

KPI Type : Revenue

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Revenue per Trailer

The total dollar amount of revenue earned by the company divided by the average number of trailers (units that house cargo) being used by the company (includes trailers either leased to or o...

KPI Type : Revenue

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Inventory Accuracy (Location)

The number of physical inventory locations/spaces that match up with the quantity and location in the reported inventory system divided by the total number of inventory locations/spaces coun...

KPI Type : Quality

Formula : (Number of Accurate Inventory Locations / Total Number of Inventory Locations Counted) * 100

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KPI's & Data 

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Inventory Accuracy (Dollars)

The absolute difference between reported and physical inventory levels (measured in dollars), as a percentage, subtracted from 100%.

KPI Type : Quality

Formula : 1 - ((Absolute Value of Difference Between Reported Inventory and Physical Inventory / Value of Reported Inventory) * 100)

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Warehouse Space Utilization

The amount of warehouse space being used (measured in square feet) divided by the total warehouse or facility space, as a percentage.

KPI Type : Quality

Formula : (Amount of Warehouse Space Used / Total Warehouse Space) * 100

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KPI's & Data 

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Customer Backorder Rate

The total number of customer orders delayed (backordered) due to the company being out of stock divided by the total number of customer orders placed over the same period of time, as a perce...

KPI Type : Service

Formula : (Number of Customer Orders Delayed due to Backorder / Total Number of Customer Orders Placed) * 100

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Percentage of Sales Lost Due to Supply Issues

The total dollar value of sales lost due to the supplier being out of stock divided by the total dollar value of customer sales over the same period of time, as a percentage.

KPI Type : Quality

Formula : (Dollar Amount of Sales Lost Due to Supply Issues / Total Dollar Value of Sales) * 100

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KPI's & Data 

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Order Picking Accuracy

The total number of orders picked and verified to be accurate prior to shipment divided by the total number of orders picked over the same period of time, as a percentage.

KPI Type : Quality

Formula : (Number of Accurate Orders Picked / Total Number of Orders Picked) * 100

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Honeycomb Percentage

The total amount of warehouse cube space (i.e., a single storage area or container) being used divided by the total warehouse cube space available for use at the same point in time, as a per...

KPI Type : Quality

Formula : (Amount of Warehouse Cubicle Space Used / Total Warehouse Cubicle Space) * 100

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KPI's & Data 

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Inventory Shrinkage

The total cost related to inventory shrinkage (broken, pilfered, spoiled, or stolen inventory) divided by the average dollar value of inventory on hand, as a percentage.

KPI Type : Quality

Formula : (Total Inventory Shrinkage Related Cost / Total Value of Inventory) * 100

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Material Handling Damage

The total value of goods and materials damaged from handling or storage divided by the total cost of goods sold (COGS) over the same period of time, as a percentage.

KPI Type : Quality

Formula : (Dollar Value of Damaged Goods and Materials / Total COGS) * 100

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KPI's & Data 

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Inventory Turnover (Finished Goods Only)

An indication of how many times a company's inventory of finished goods is sold and replaced over a set period of time. Can be calculated by dividing the cost of goods sold (COGS) by the ave...

KPI Type : Productivity

Formula : Total Cost of Goods Sold / ((Inventory Value of Finished Goods at Start of Measurement Period + Inventory Value of Finished Goods at End of Measurement Period) / 2)

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KPI's & Data 

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Inventory Turnover (Raw Materials Only)

An indication of how many times a company's inventory of raw materials is used and/or sold and replaced over a set period of time. Can be calculated by dividing the cost of goods sold (COGS)...

KPI Type : Productivity

Formula : Total Cost of Goods Sold / ((Inventory Value of Raw Materials at Start of Measurement Period + Inventory Value of Raw Materials at End of Measurement Period) / 2)

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