- Order Fulfillment Cycle Time
Order fulfillment cycle time is the time it takes from receiving an order to delivering the product to the customer. By measuring this KPI, businesses can determine how efficient their supply chain is and identify any bottlenecks or delays in the process. Shorter cycle times mean that the business can fulfill more orders and improve customer satisfaction.
- Inventory Turnover
Inventory turnover is a measure of how quickly a business sells its inventory and replaces it with new stock. A high inventory turnover rate indicates that the business is managing its inventory efficiently and minimizing the risk of excess inventory. This KPI is critical in ensuring that the business has the right amount of inventory on hand to meet customer demand while minimizing carrying costs.
- Cost of Goods Sold (COGS)
COGS is the direct cost of producing a product, including materials and labor. By measuring COGS, businesses can determine the profitability of their products and identify areas where they can reduce costs. It is also essential to monitor COGS over time to ensure that the business is maintaining profitability.
- Perfect Order Rate
Perfect order rate is the percentage of orders that are delivered to customers without any errors or issues. This KPI measures the effectiveness of the supply chain in meeting customer requirements and can help identify areas for improvement, such as reducing the number of damaged or incorrect shipments.
- On-Time Delivery
On-time delivery measures the percentage of orders that are delivered to customers on or before the expected delivery date. By measuring this KPI, businesses can identify any delays in the supply chain and take corrective action to improve delivery times.
- Cash-to-Cash Cycle Time
Cash-to-cash cycle time is the time it takes for a business to convert cash spent on inventory into cash received from sales. By measuring this KPI, shipping companies in India can identify opportunities to reduce the cash tied up in the supply chain and improve cash flow.
- Supplier Performance
Supplier performance measures the effectiveness of suppliers in meeting the business’s needs, including quality, delivery times, and pricing. By measuring this KPI, businesses can identify the best suppliers and work with them to improve supply chain efficiency.
- Transportation Costs
Transportation costs measure the cost of transporting goods from suppliers to the business and from the business to customers. By measuring this KPI, businesses can identify areas for cost savings and improve supply chain efficiency.
In conclusion, supply chain management KPIs are essential tools for measuring the effectiveness of a business’s supply chain and identifying areas for improvement. By monitoring these KPIs over time, supply chain and shipping service businesses can optimize their processes and achieve sustainable growth.
