Procurement KPIs, Metrics & Benchmarks

KPIs & Metrics to Measure and Manage Procurement Department Performance

Procurement

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KPI's & Data 

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Management Levels: Procurement

The total number of management levels, or layers, in the Procurement Department.

KPI Type : Organizational

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Total Volume: Supplier Orders

The total number of supplier orders processed by the Procurement Department over a certain period of time.

KPI Type : Volume

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Organizational Structure: Procurement

A yes/no metric indicating whether the Procurement function is centralized (all employees in a single location) or decentralized.

KPI Type : Organizational

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Total Expense per Procurement Employee

The total expense incurred by the company over a certain period of time divided by the number of employees working within the Procurement Department.

KPI Type : Cost

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Procurement Staffing Ratio

The number of company-wide employees divided by the total number of Procurement employees working for the company at the same point in time, expressed as a ratio (e.g., total employees per P...

KPI Type : Organizational

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Percentage of Sole-Source Materials

The amount of materials received from sole-sourced, or exclusive, company suppliers divided by the total amount materials received over the same period of time, as a percentage.

KPI Type : Quality

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Unit Cost: Vendor Audit

The total cost of performing vendor audits divided by the number of vendors audits performed over the same period of time.

KPI Type : Cost

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Supplier Backorder Rate

The number of orders from company suppliers delayed in shipment due to the supplier being out of stock divided by the total number of supplier orders made over the same period of time, as a...

KPI Type : Quality

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Supplier Contracts per Procurement Employee

The number of vendors under contract divided by the number of employees working within the Procurement Department at the same point in time.

KPI Type : Productivity

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KPI's & Data 

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Cycle Time: Supplier Contract Negotiation

The number of business days required to negotiate a vendor contract, from the time the initial contract is developed and distributed until when the contract is agreed upon and executed by al...

KPI Type : Service

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Cycle Time: Supplier Contract Development

The number of business days required to draft a supplier contract agreement, from the time the supplier and company reach a verbal agreement until the contract is ready to be distributed to...

KPI Type : Service

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Percentage of Vendor Contracts Changed

The number of vendor contracts that are changed, or amended, during the life of the original contract divided by the total number of vendor contracts under management over the same period of...

KPI Type : Quality

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Number of Supplier Contracts Under Management

The total number of supplier, or vendor, contracts managed by the Procurement Department at a certain point in time.

KPI Type : Volume

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Procurement Expense as a Percentage of Total Expense

The operating expense incurred by the Procurement Department divided by the total expense incurred by the company over the same period of time, as a percentage.

KPI Type : Cost

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KPI's & Data 

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Procurement Expense as a Percentage of Total Revenue

The operating expense incurred by the Procurement Department divided by the total revenue generated by the company over the same period of time, as a percentage.

KPI Type : Cost

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Procurement Systems Expense as a Percentage of Total Procurement Expense

The expense incurred by Procurement systems (ERP, supply chain management systems, etc.) divided by the total expense incurred by the Procurement Department over the same period of time, as...

KPI Type : Cost

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Supplier Contract Compliance

The number of suppliers that are meeting the service and quality levels as defined in the executed contract divided by the total number of vendor contracts under management at the same point...

KPI Type : Quality

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Supplier Discount Rate

The total actual cost of purchasing goods or services through company suppliers divided by the hypothetical pre-discount cost for the purchases made over the same period of time, as a percen...

KPI Type : Quality

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Total Savings Through Supplier Discounts

The total dollar amount of savings generated through discounts negotiated with company suppliers over a certain period of time.

KPI Type : Quality

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Percentage of Supplier Contracts with Pre-defined Performance Criteria

The number of supplier contracts under management that contain clearly defined supplier performance criteria divided by the total number of supplier contracts under management at the same po...

KPI Type : Quality

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Percentage of Supplier Contracts Terminated

The number of supplier contracts that must be terminated due to poor performance by the supplier divided by the total number of supplier contracts under management over the same period of ti...

KPI Type : Quality

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KPI's & Data 

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Unit Cost: Supplier Contract Development

The total cost of developing supplier contracts divided by the number of supplier contracts developed over the same period of time.

KPI Type : Cost

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Percentage of Supplier Contracts Requiring Exception Approval

The number of supplier contracts negotiated that deviate from typical company supplier standards, requiring an exception, divided by the total number of supplier contracts negotiated over th...

KPI Type : Quality

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Inventory Value: Raw Materials

The total dollar value of raw materials within the company's inventory at a certain point in time. Raw materials are substances used in the primary production or manufacturing of a product o...

KPI Type : Volume

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Inventory Value: Components (Intermediate Goods)

The total dollar value of components, or intermediate goods, within the company's inventory at a certain point in time. Intermediate goods are pre-fabricated parts (not raw materials) that a...

KPI Type : Volume

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Inventory Value: Finished Goods

The total dollar value of finished goods within the company's inventory at a certain point in time. Finished goods are the output of the production or manufacturing process; these items are...

KPI Type : Quality

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Inventory Value: Replacement Parts

The total dollar value of material considered to be replacement parts within the company's inventory at a certain point in time. Replacement parts are materials or components available to be...

KPI Type : Quality

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Inventory Value: Obsolete Goods

The total dollar value of obsolete goods within the company's inventory at a certain point in time. Obsolete goods are materials/goods that are no longer manufactured/sold.

KPI Type : Quality

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Average Shelf Life: Finished Goods

The average number of days (Includes business and non-business days) that finished goods remain in company inventory facilities prior to shipment to customers.

KPI Type : Quality

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Average Shelf Life: Obsolete Goods

The average number of days (Includes business and non-business days) that the company retains obsolete goods (i.e., goods that are no longer manufactured/sold) in company storage facilities.

KPI Type : Quality

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