Benchmarking Warehouse Performance Starts With Data

Data is the cornerstone of getting a true snapshot of not only how well your distribution center is operating, but also the impression your company is leaving with customers.

However, in order to build toward the answers companies seek, they must start by laying that cornerstone and begin collecting data. Doing so brings a host of questions, including: What data is meaningful and what is just data? How often should we collect the information? What are acceptable numbers and what numbers are indicators of problems in need corrective actions? What do I do with this data to improve processes? All are important questions to ask and the answers may vary by company.

Below are a few important key performance indicators (KPIs) that can help companies get an idea of how their distribution centers are operating.

Shipping accuracy. Arguably one of the most important KPIs, shipping accuracy tracks that the shipment arrives at the destination exactly the way it was released, with the correct item and the correct quantity

Total damage compared to on-hand inventory. Simply, the amount of damage caused in the distribution center compared to the total on-hand inventory.

Inventory accuracy. How accurately is inventory managed? This KPI will review each inventory unit and check that it is in the correct location, has the correct count, and is the correct item compared to information in the warehouse management system.

On-time shipments. This is defined by each shipment leaving the distribution center at or before the scheduled appointment time.

Safety. Many operations will hold a standard of OSHA recordable injuries in a calendar year. While the goal of this KPI always will be zero, each company will set a standard based on past history.

Remember, while these are internal KPIs, each has an impact on how customers view your company.