* Is High or Low Best: Lower is Better
Transportation Expense as a Percentage of Total Revenue measures the transportation-related expense (fuel, fleet management costs, driver labor, etc.) incurred in relation to the total revenue generated by the company over the same period of time. A relatively high value for this metric is typically related to a few common factors, including overstaffing, general inefficiencies within transportation processes (e.g., inaccurate fuel tracking, inefficient fleet maintenance procedures, poor expense management practices, etc.), and sub-par transportation employee training and performance. While companies typically seek to streamline operations and transportation employee positions to reduce expenses in transporting products, great care should be taken when doing so as too many layoffs can have a negative impact on company morale and make it difficult to provide customers the products they ordered in a timely fashion.
The transportation-related expense (fuel, fleet management costs, driver labor, etc.) incurred divided by the total revenue generated by the company over the same period of time, as a percentage.
Two values are used to calculate this KPI: (1) the transportation-related expense (fuel, fleet management costs, driver labor, etc.) incurred, and (2) the total revenue generated by the company over the same period of time. Include labor (wages, salaries, commissions, benefits), overhead (occupancy, utilities, supplies, advertising, legal fees, travel costs, etc.), and technology (hardware, software, etc.) costs associated with product and material transportation in the numerator. Do not include warehousing or order management costs in this calculation.
(Transportation-Related Expense Incurred / Total Company-Wide Revenue Generated) * 100
The total expense incurred by a company's distribution center (e.g., expense focused on receiving shipments, warehousing, sorting, inventory control, picking, etc.) divided by the number of...
KPI Type : Cost
Formula : Total Distribution Center Expense Incurred / Number of Cases or Pallets
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