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Supply Chain Metrics and KPIs
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Gross Margin Return on Investment (GMROI)
Measures the profit return on the amount of inventory investment made. It assesses the effectiveness of inventory in generating revenue.
Backorder Rate
Measures the percentage of orders that cannot be filled at the time of customer request and are placed on backorder. It identifies stock availability issues.
Perfect Order Rate
Measures the percentage of orders that are error-free. It evaluates the effectiveness of the supply chain in delivering products correctly and on time.
Supply Chain Cycle Time
Measures the total time taken for a product to move through the entire supply chain, from raw materials to the delivered product. It identifies bottlenecks and inefficiencies.
Cash-to-Cash Cycle Time
Measures the time between purchasing raw materials and receiving payment from customers for product sales. It evaluates how quickly a company converts investments into cash.
Net Promoter Score (NPS)
Gauges customer loyalty and satisfaction by measuring the likelihood of customers to recommend a company's products or services.
Safety Stock Levels
Measures the amount of extra inventory kept on hand to prevent stockouts in the face of demand variability and supply chain disruptions.
Total Supply Chain Management Cost
Measures the combined costs of all activities and processes across the supply chain, from sourcing to delivery to the customer, impacting the company's bottom line.
Material Acquisition Cost
Measures the total expenses involved in procuring raw materials necessary for production, including costs related to purchasing, handling, and transportation.
Capacity Utilization
Measures the extent to which a company uses its installed productive capacity. It indicates the efficiency and scalability of operations.
Customer Order Cycle Time
Measures the time from when a customer order is placed until the product is delivered, reflecting supply chain speed and customer service level.
Service Level
Measures the percentage of order demand that is met without stockouts or backorders, reflecting supply chain reliability.
Lead Time
Measures the time taken from placing an order with a supplier to the receipt of the goods. It impacts stock levels and customer satisfaction.
Throughput
Measures the rate at which a company's system produces goods or services, showing the efficacy and productivity of the production process.
Supply Chain Flexibility
Measures the agility of the supply chain in adapting to changes in volume, delivery, and the mix of products or services, affecting customer responsiveness and competitiveness.
Stockout Rate
Measures the frequency at which inventory for a particular item is exhausted, affecting customer satisfaction and sales.
Manufacturing Cycle Efficiency (MCE)
Measures the proportion of production cycle time that is spent on value-added activities, highlighting process efficiency and waste reduction.
Return on Supply Chain Fixed Assets
Measures the profitability derived from supply chain fixed assets, such as warehouses and transportation vehicles, indicating asset utilization efficiency.
Supply Chain Finance Cost
Measures the total cost associated with financing the supply chain, including the cost of capital and credit terms with suppliers, impacting overall expenditure.
Demand Forecast Accuracy
Measures the precision of the demand forecasts by comparing predicted sales to actual sales, revealing planning effectiveness.
Average Inventory
Measures the average quantity of inventory held over a specific period, indicating how well inventory is being managed against sales performance.
Inventory Turnover
Measures how often a company sells and replaces its stock of goods within a period. It indicates how well inventory is managed and demand forecasting accuracy.
On-time Delivery
Measures the percentage of products delivered to customers on or before the promised delivery date. It indicates the reliability and efficiency of the logistics process.
Freight Bill Accuracy
Measures the accuracy of freight bills by comparing billed amounts against agreed rates and terms. Ensures appropriate freight spend and avoids overcharging.
Supply Chain Responsiveness
Measures the agility of the supply chain in responding to market changes or disruptions, reflecting its adaptability and resilience.
Supplier On-time Performance
Measures the percentage of times suppliers deliver goods or services on or before the agreed time, indicating supplier reliability and impact on production schedules.
Days of Supply
Measures how long current inventory will last given current demand levels. It anticipates stock-outs and helps plan inventory replenishment.
Warehouse Capacity Utilization
Measures how efficiently the available warehouse space is used, affecting storage costs and inventory management.
Cost of Quality
Measures the costs associated with ensuring quality products and services, including prevention, appraisal, and failure costs, affecting profitability and customer satisfaction.
Sell-Through Rate
Measures the percentage of inventory sold within a specific period, highlighting demand levels and inventory management performance.
Out of Stock Rate
Measures the percentage of times customers face out-of-stock situations, signaling potential sales loss and customer service issues.
Rate of Return
Measures the rate at which customers return products, influencing supply chain costs, inventory management, and product quality control.
Customer Satisfaction Index
Measures how products or services meet or exceed customer expectations, indicating the quality of customer service and product performance.
Order Fill Rate
Measures the percentage of customer orders filled completely on the first shipment. It reflects how well the supply chain meets customer demand.
Freight Cost Per Unit
Calculates the cost of shipping per unit of product, enabling analysis of freight cost efficiency and cost control in logistics.
Supply Chain Management Cost
Measures the total costs involved in managing the supply chain, including procurement, production, and logistics, affecting overall profitability.
Supplier Lead Time
Measures the time taken by suppliers to deliver goods after an order is placed, impacting inventory planning and production schedules.
Cost Per Order
Measures the average cost involved in processing a customer order, including labor, materials, and overhead, indicating efficiency and cost control in order fulfillment.
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