Every business has a set of Key Performance Indicators they continually monitor to optimize their operations. In transportation, monitoring KPIs is a critical aspect of supply chain management, and companies rely heavily on these metrics to make improvements to move goods efficiently and cost-effectively. As we move towards 2024, the transportation industry is expected to undergo significant changes driven by technology advancements, regulatory changes, and evolving customer expectations.
This KPI checklist lists some factors worth planning for in the coming year. Download a PDF of the list below for a quick check of which ones your company should be ready to conquer. By tracking these KPIs, your business can identify areas for improvement, reduce costs, and optimize their fleet utilization.
Measures the percentage of shipments that are delivered on time to the destination.
Why it matters: Not meeting on-time delivery rates can lead to increased costs, which can include expedited shipping fees and lost sales due to customers taking their business elsewhere.
Calculate the cost of transportation per unit of product shipped, including fuel, labor, and other costs.
Why it matters: Transportation cost per unit can affect pricing decisions for products and if it's high, businesses may need to increase the price of the product to maintain profitability, which can make the product less competitive in the market.
Measure the average time goods spend in warehouses or distribution centers before being transported, aiming for minimal delays.
Why it matters: The longer goods spend in a warehouse, the more expensive it becomes for businesses to store them, which can impact your profitability.
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Measure the percentage of available transportation capacity that is being utilized to transport goods.
Why it matters: Unused capacity can result in wasted resources and increased costs.
Measure the time it takes to process an order and transport goods to the destination.
Why it matters: Shorter order lead time can lead to happier customers, increased sales, and a competitive advantage with supply chain operations.
Monitoring the average time it takes for goods to be transported from one location to another, ensuring timely deliveries.
Why it matters: Customers today expect fast and efficient delivery of their orders, and longer transit times can result in dissatisfaction, negative reviews, and even lost business.
Evaluating how quickly inventory is being moved and replenished, which can impact transportation requirements and costs.
Why it matters: A high inventory turnover rate is generally seen as a positive sign because it suggests that a company is efficiently managing its inventory and generating sales from it.
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