Supply Chain KPIs: Definitions and Formulas
Supply chain KPIs connect sourcing decisions, stock health, transport, production, and fulfilment into one operating view. Every KPI page explains the calculation, a fictional example, interpretation guidance, limitations, and related measures.
Procurement & Sourcing
Measure purchasing efficiency, supplier quality, managed spend, cycle time, savings, and procurement value.
Procurement Cost Savings
Total savings achieved through procurement cost reduction initiatives.
Definition and formulaPurchase Order Cycle Time
Average time it takes to create, approve, and process a purchase order.
Definition and formulaSupplier Lead Time
Average time taken by suppliers to fulfill orders.
Definition and formulaSupplier On-Time Delivery Rate
Percentage of orders delivered by suppliers on or before the agreed date.
Definition and formulaCost per Order
Average cost incurred to process a purchase order.
Definition and formulaSupplier Defect Rate
Percentage of goods from suppliers that are defective.
Definition and formulaSpend Under Management (SUM)
Percentage of total organizational spend actively managed by procurement.
Definition and formulaSupplier Performance Score
Composite score based on supplier quality, delivery, and responsiveness.
Definition and formulaMaverick Spending Rate
Percentage of purchases made outside of approved procurement processes.
Definition and formulaProcurement ROI
Return on investment for procurement activities.
Definition and formulaInventory Management
Balance stock availability with accuracy, turnover, carrying cost, loss, safety stock, and fulfilment demand.
Inventory Turnover
Measures how often inventory is sold and replaced in a given period.
Definition and formulaDays Inventory Outstanding (DIO)
Average number of days inventory is held before being sold.
Definition and formulaInventory Accuracy Rate
Percentage of inventory records that match actual physical stock.
Definition and formulaStockout Rate
Percentage of inventory items that were out of stock when needed.
Definition and formulaCarrying Cost of Inventory
Total cost of holding inventory, including storage, insurance, and depreciation.
Definition and formulaOrder Fill Rate
Percentage of customer orders fulfilled completely from available stock.
Definition and formulaSafety Stock Level
Minimum amount of inventory kept on hand to avoid stockouts.
Definition and formulaDead Stock Percentage
Percentage of inventory that has not been sold or used over a specified period.
Definition and formulaInventory Backorder Rate
Percentage of orders delayed due to insufficient stock levels.
Definition and formulaInventory Shrinkage
Percentage of inventory lost due to theft, damage, or administrative error.
Definition and formulaLogistics & Transportation
Track delivery speed, accuracy, capacity, freight cost, damage, returns, and the movement of customer orders.
Logistics On-Time Delivery Rate
Percentage of deliveries made on or before the scheduled time.
Definition and formulaAverage Delivery Time
Average time it takes to deliver goods to customers or destinations.
Definition and formulaTransportation Cost Per Unit
Average cost of transporting one unit of product.
Definition and formulaFreight Cost Percentage
Percentage of revenue spent on freight and transportation.
Definition and formulaLoad Capacity Utilization Rate
Percentage of transportation capacity utilized per shipment.
Definition and formulaShipment Damage Rate
Percentage of shipments damaged during transit.
Definition and formulaBackorder Delivery Time
Average time taken to deliver backordered goods.
Definition and formulaOrder Fulfillment Cycle Time
Average time taken to process, ship, and deliver an order.
Definition and formulaDelivery Accuracy Rate
Percentage of shipments delivered to the correct location on the first attempt.
Definition and formulaReturns Rate
Percentage of goods returned due to delivery errors or defects.
Definition and formulaProduction & Efficiency
Assess throughput, equipment performance, quality, downtime, resource use, waste, and manufacturing productivity.
Production Cycle Time
Average time taken to produce a single unit of product.
Definition and formulaCapacity Utilization Rate
Percentage of production capacity being used.
Definition and formulaOverall Equipment Effectiveness (OEE)
Measures how effectively production equipment is utilized.
Definition and formulaDowntime Percentage
Percentage of production time lost due to equipment or process failures.
Definition and formulaYield Rate
Percentage of products that meet quality standards without rework.
Definition and formulaScrap Rate
Percentage of raw materials wasted during production.
Definition and formulaFirst Pass Yield (FPY)
Percentage of products that pass quality inspection on the first attempt.
Definition and formulaOrder Lead Time
Average time taken from order placement to production completion.
Definition and formulaEnergy Usage per Unit Produced
Average energy consumption per unit of product manufactured.
Definition and formulaLabor Productivity
Average output produced per labor hour worked.
Definition and formulaCustomer Fulfillment
Measure whether complete, accurate orders reach customers on time and at a sustainable fulfilment cost.
Perfect Order Rate
Percentage of orders delivered without issues (e.g., late delivery, damage, incorrect items).
Definition and formulaOrder Fulfillment Time
Average time taken to process and deliver customer orders.
Definition and formulaOrder Accuracy Rate
Percentage of orders delivered with correct items and quantities.
Definition and formulaCustomer Satisfaction Score (CSAT)
Measures customer satisfaction with the order fulfillment process.
Definition and formulaCustomer Fulfillment On-Time Delivery Rate
Percentage of orders delivered on or before the expected delivery date.
Definition and formulaCustomer Fulfillment Backorder Rate
Percentage of orders delayed due to insufficient inventory.
Definition and formulaReturn Rate
Percentage of delivered goods returned by customers.
Definition and formulaFulfillment Cost per Order
Average cost incurred to process and deliver an order.
Definition and formulaDelivery Satisfaction Rate
Percentage of customers satisfied with the delivery experience.
Definition and formulaOrder Cycle Time
Total time from customer order placement to delivery.
Definition and formulaTurn metric definitions into answers your team can use.
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