Distribution Expense as a Percentage of Total Revenue
This PDF report includes benchmarking data (in a visual, chart-based format), an comprehensive KPI definition, characteristics of high performers and technical details on measuring Distribution Expense as a Percentage of Total Revenue. Purchase and download this easy-to-understand, presentation-ready report immediately to compare performance levels, set attainable performance targets, and push towards best-in-class performance for this KPI.
What is Distribution Expense as a Percentage of Total Revenue?
Total distribution expense incurred by the company divided by the total amount of revenue generated by the company over the same time period, as a percentage.
Why should Distribution Expense as a Percentage of Total Revenue be measured?
Distribution Expense as a Percentage of Total Revenue measures the investment in distribution that is utilized by the company to generate its stated revenue. A high value for this KPI may suggest small order sizes, excessive equipment maintenance costs, ineffective inventory management, costly vendor selection, poor materials handling, expensive warehouse facilities, overstaffed Distribution functions or slow shipment/delivery cycle times. Companies that incur high distribution costs may pass those expenses on to customers in the form of shipping charges, which may cause customer dissatisfaction. Companies can reduce their distribution expenses by consolidating customer orders, setting productivity goals, optimizing packaging materials for different types of shipments, minimizing order errors, etc.
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