Warehousing
Warehousing Analytics.
Measuring performance, efficiency, and cost-effectiveness.
We have identified several industry specific metrics (see below) that may be of interest to you. However, there are basic business metrics that should always be analysed, and regularly, in order to point you in the direction of what needs investigation. These are:
Revenue. Total income generated from sales before any expenses. It shows the overall scale of the business and is a top-line indicator of growth and demand.
Net Profit Margin. Net Profit expressed as a percentage. It reveals how much actual profit the business makes after all expenses … a key measure of efficiency and sustainability.
Cash Flow. Net amount of cash moving into and out of the business. Indicates liquidity and the ability to meet short term obligations, invest, and grow.
Fixed Costs vs Revenue. Costs associated with running the business. Identifies areas to reduce costs and improve profitability.
Accounts Receivable/Payable. Identifies what may be affecting cashflow.
Industry Specific Metrics: Warehousing
Inventory Turnover Rate
Why? Low turnover signals overstocking or stocking slow-moving products, tying up cash unnecessarily. High turnover demonstrates efficient use of capital.
Order Picking Accuracy
Why? Mistakes in picking leads to returns, rework and unhappy customers. Accurate picking improves customer satisfaction and stops wasted time in re-stocking, and re-picking.
Order Cycle Time
Why? Responsiveness. Shorter cycle times demonstrates faster fulfillment and better competitiveness.
Warehouse Space Utilisation
Why? Optimising warehouse space and layout reduces the need for expansion and lowers overhead costs. Poor utilisation means paying for wasted space and time.
Inventory Accuracy
Why? Discrepancies between system and physical counts cause delays, stockouts, and trust issues with customers and management.
Dock to Stock Time
Why? Fast processing from dock to storage keeps inventory moving and ready to fulfill orders, reducing bottlenecks in receiving.
Perfect Order Rate
Why? This is a critical quality metric. The higher it is, the better your warehouse is at meeting customer expectations without error.
Low Backorder Rate
Why? High numbers of backorders leads to frustrated customers which leads to lost sales. Tracking helps identify demand planning and inventory issues.
Carrying Cost of Inventory
Why? Holding inventory costs money. Managing inventory efficiently increases profitability without sacrificing service levels.
Labor Productivity
Why? Measuring output per hour identifies training needs, inefficiencies, and automation opportunities.