Warehouse KPI

All the logistic operations must be executed with high performance to have a good cost. For this reason it is necessary to measure these operations and to set up target for performance. For this it is necessary to have KPI (key performance indicators), a KPI which is necessary to be relevant for the business, to be easy to measure and also easy to understand by the people. A good advice it is to choose the relevant KPI for your business, relevant KPI means that KPI which can be easily connected with the global KPI for business. Also I advise you to not use too many KPI, because you lose the essence of the operations if you setup too much KPI. It is not a fix number of KPI for an area, but, according to my experience, if you have more than 5-6 KPI for an area it is necessary to revise this.

Warehouse it is an important area of the logistics and supply chain operations. In these posts I want to define a few KPI which can be used in this area. It is also important when you define a KPI to define the way that this KPI is measure and also the short definition of the KPI.

It the following section I will define some KPI’s for warehouse operations:

-Number of orders prepare per hours – define how many order is prepare per hour;

-Number of orders prepare by a man – define how many orders is prepare by a single man;

-Number of orders prepare by shifts – define the number of order prepare by a shift;

-Value of the safety stock – define the value (in money ) of the safety stock;

-Total space in warehouse;

-Total available space in the warehouse;

-Total value of stock;

-Total value of stock per SKU (Stock Keeping Unit) or Item;

-Total number of warehouses;

-OOS – out of stock – take care of this parameter because can be define in different ways. The best way to define this KPI is correlated with the service level agreement;

-OOS per item or SKU;

-Average time to process an order;

-Tone in per day;

-Tone out per day;

-No of pallets in per period of time VS no of pallets out per period of time;

-No of SKU in per period of time VS no of pallets out per period of time;

-No of full pallets out per period of time;

-No of mixed pallets per period of time;

-Cost for order management;

-Cost per order;

-Cost per order line;

-Cost per order per client;

-No of order line picked per day;

-Cost per order per every warehouse;

-Cost per stored pallet per day;

-Cost with working materials and package;

-Total no of SKU in warehouse;

-Total n of active SKU in warehouse;

-Days of stock per warehouse;

-Days of stock per SKU;

-Inventory costs;

-Picking mistake per man, per period of time, per warehouse etc;

-No of tone moved by a man per period of time;

-Reception time for one pallet;

-Quality of reception (percentage of wrong receptions for total receptions);

-Average time to process a document and to insert it in WMS;

-Average distance for picking per order;

-Cost per man per hour;

-Working hour for machinery (forklifts etc);

-Fuel consumption for machinery;

-Total value maintenance for machinery;

 

We can define many others KPI’s for warehouse operations. Those are just an example to see how you can measure. Some of those KPI’s is not easy to measure and those KPI have different value for different companies or for different business. Keep in mind that every quantitative KPI’s it must me correlate with a qualitative KPI’s (for example: number of pallets receives per hour can be correlate with quality of pallets reception).

I hope that post can help you and if you like it please share with you friend and colleges.

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