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# Supply chain KPIs to track

Effective [supply chain](https://infoveave.com/solutions/industry/supply-chain) and **distribution** management depends on governed KPIs across procurement, warehousing, logistics, and delivery. This library covers the ten metrics most operations leaders start with — plus four **distribution and logistics KPIs** (OTIF, FADR, pick accuracy, dock-to-stock) that distribution managers track when WMS, TMS, and carrier data live on one platform. For a practitioner's dashboard framework, see the [supply chain KPI dashboard guide](/resources/guide/supply-chain-kpi-dashboard-guide). For distribution operations context, see [distribution analytics KPIs](/resources/blogs/distribution-analytics-kpis).

## Why are supply chain KPIs important?

Supply chain KPIs are important because they provide organizations with measurable insights into their operational efficiency and effectiveness within the supply chain. By tracking these key metrics, businesses can identify bottlenecks, streamline processes, and enhance overall supply chain performance. KPIs enable informed decision-making, allowing companies to respond quickly to fluctuations in demand and supply. They also help optimize inventory levels, reduce logistics costs, and improve order fulfillment rates, ultimately leading to increased profitability and customer satisfaction. In a dynamic market, effective use of supply chain KPIs is crucial for sustained success.

## 10 Important KPIs to track in supply chain

## 1\. Inventory Turnover

Inventory turnover measures how often a company sells and replaces its inventory within a specific period. This helps businesses as it indicates how efficiently inventory is managed.

A higher inventory turnover rate shows that a company is selling inventory quickly, leading to reduced holding costs and increased cash flow. A lower turnover rate shows excess inventory, weak demand, prompting a reassessment of inventory management strategies.

> Inventory Turnover = Cost of Goods Sold / ((Opening Stock - Closing Stock) / 2)

## 2\. On-Time Delivery Rate

The on-time delivery rate measures the percentage of customer orders delivered on or before the promised delivery date. This KPI is critical for assessing customer service performance and supply chain efficiency.

A higher on-time delivery rate shows a reliable supply chain and effective logistics management, which fosters customer trust. A lower rate may reveal issues such as logistical delays or inefficiencies in order processing, prompting a need for improvement in delivery operations.

> On-Time Delivery Rate = (Number of on time deliveries / Number of deliveries) x 100

**Note:** On-time delivery counts timing only. For distribution and wholesale scorecards, pair this with **on-time in-full (OTIF)** below — the metric that also requires complete quantity on the first delivery.

## 3\. Days Sales Outstanding

Days Sales Outstanding measures the average number of days it takes a company to collect payment after a sale is made. This KPI is crucial for managing cash flow and assessing the efficiency of accounts receivable processes.

A lower days sales outstanding shows that a business effectively collects payments, improving liquidity and reducing financing costs. A higher days sales outstanding shows issues with credit policies or customer payment behaviors, prompting a review of credit terms or collection practices.

> Days Sales Outstanding = (Account receivables / Credit Sales) x Number of Days

## 4\. Fill Rate

The fill rate measures the percentage of customer orders that are completely fulfilled from available inventory. This KPI is essential for assessing inventory management and customer satisfaction.

A higher fill rate shows efficient inventory management and fulfillment processes, leading to improved customer satisfaction. A lower fill rate shows stockouts or inadequate inventory planning, prompting a reassessment of inventory levels and ordering strategies.

> Fill Rate = ((Total Number of Items – Number of Shipped Items) / Total Number of Items) x 100

## 5\. Freight Bill Accuracy

Freight bill accuracy evaluates the correctness of freight bills by comparing billed amounts against agreed rates and services. This KPI is important for cost control and reducing disputes with logistics providers.

A higher freight bill accuracy rate shows effective cost management and fewer billing discrepancies, leading to stronger vendor partnerships. A lower rate shows issues in billing processes or contract compliance, prompting a review of freight contracts and billing practices.

> Freight Bill Accuracy = (Number of Correct Freight Bills / Total Freight Bills) x 100

## 6\. Average Transit Time

Average transit time measures the average time goods spend in transit from the supplier to the customer. This KPI is essential for assessing the efficiency of logistics operations and ensuring timely deliveries.

A shorter average transit time shows efficient logistics and effective transportation management, leading to improved customer service. A longer transit time shows inefficiencies in transportation routes or processes, prompting a need for optimization in logistics operations.

> Average Transit Time = Transit time / Number of deliveries

## 7\. Supplier Defect Rate

The supplier defect rate measures the percentage of defective products received from suppliers compared to the total products received. This KPI is critical for quality control in procurement and can impact production efficiency and customer satisfaction.

A lower supplier defect rate shows effective supplier quality management and reliable sourcing, leading to reduced rework and customer complaints. A higher defect rate shows issues with supplier quality assurance, necessitating a review of supplier relationships and quality control processes.

> Supplier Defect Rate = (Number of defective products received / Number of products received) x 100

  
![Top 10 Supply Chain KPIs](https://cdn.infoveave.com/kpi-liabrary/top-10-supply-chain-kpis-to-track.webp)   

## 8\. Warehouse Efficiency Index

Assesses the productivity and efficiency of warehouse operations, often calculated based on metrics such as throughput and space utilization. This KPI is vital for optimizing warehouse operations and improving inventory management, directly impacting overall supply chain performance.

A higher warehouse efficiency index shows effective space utilization and streamlined processes, leading to lower operating costs and improved order fulfillment rates. A lower index shows inefficiencies in warehouse operations, prompting a need for process improvements and staff training.

> Warehouse Efficiency Index = (Output value / Input value) x 100

## 9\. Cost per Mile

This evaluates the transportation costs incurred for each mile travelled in delivering goods to customers. This KPI is essential for optimizing logistics expenses and assessing the overall efficiency of transportation operations.

A lower cost per mile shows effective route planning and fuel efficiency, contributing to improved profitability. A higher cost shows inefficiencies in transportation management, prompting a need for re-evaluation of logistics strategies and carrier agreements.

> Cost per Mile = Transportation costs / Miles Travelled

## 10\. Perfect Order Rate

The perfect order rate measures the percentage of orders delivered to customers that are complete, on time, and undamaged. This KPI is essential for evaluating overall supply chain performance and customer satisfaction.

A higher perfect order rate reflects a well-managed supply chain, leading to enhanced customer trust and loyalty. A lower rate shows inefficiencies in order processing, fulfillment, prompting a need for improvements in supply chain operations to meet customer expectations consistently.

> Perfect Order Rate = (Number of perfect orders / Number of orders) x 100

## Distribution and logistics KPIs

Distribution managers and logistics leads track these metrics alongside the core ten — especially when connecting WMS, TMS, and carrier feeds on a [unified data platform](https://infoveave.com/unified-data-platform). Full operational context: [Distribution Analytics KPIs](/resources/blogs/distribution-analytics-kpis) and [last-mile distribution analytics](/resources/blogs/last-mile-distribution-analytics).

### On-Time In-Full (OTIF)

OTIF measures the percentage of orders delivered **both** on time **and** complete — no short shipments or partial lines. It is the gold-standard customer-facing metric for distribution, wholesale, and B2B fulfilment because timing alone misses incomplete deliveries.

A rising OTIF score reflects aligned warehouse, transport, and allocation performance. A falling OTIF often signals pick errors, carrier delays, or allocation rules that ship partial orders without escalation.

> OTIF = (Number of orders delivered on time and in full / Total orders) x 100

### First Attempt Delivery Rate (FADR)

FADR measures successful deliveries on the first attempt — before redelivery, depot return, or customer reschedule. It is a core **last-mile** and distribution KPI: failed first attempts drive cost, WISMO contacts, and churn.

Low FADR usually points to address quality, narrow delivery windows, route density, or carrier execution — not only warehouse performance.

> FADR = (Successful first-attempt deliveries / Total delivery attempts) x 100

### Pick Accuracy

Pick accuracy tracks correct SKU and quantity on outbound order lines — typically from WMS scan validation or QA audits. It is essential inside the DC before OTIF and perfect order rate can improve downstream.

Errors caught at pack station still cost labour; errors that reach the customer hit fill rate, returns, and OTIF simultaneously.

> Pick Accuracy = (Correct pick lines / Total pick lines) x 100

### Dock-to-Stock Time

Dock-to-stock time is the average elapsed time from goods receipt at the dock until inventory is available for allocation and picking. Slow receiving creates **phantom stock** — WMS shows units on hand before put-away completes, inflating fill rate until picks fail.

Track by DC, shift, and supplier to tie inbound delays to outbound OTIF in one dashboard.

> Dock-to-Stock Time = Sum(receipt-to-available hours) / Number of receipts

### Lines Picked per Labour Hour

Lines picked per labour hour measures warehouse productivity — how many order lines a picker completes per paid hour in the DC. Distribution managers use it to compare shifts, sites, and automation investments, but only after [data quality](/platform/data-quality) confirms scan compliance is consistent; otherwise teams that skip validation look artificially productive.

Rising throughput with stable pick accuracy signals real efficiency. Rising throughput with falling accuracy usually means speed is winning over controls.

> Lines Picked per Labour Hour = Total pick lines completed / Total direct labour hours in picking

### Cost-to-Serve

Cost-to-serve is the fully loaded distribution cost to fulfil an order, pallet, or customer — warehouse labour, storage, pick/pack, outbound freight, and handling allocated from ERP finance and WMS activity data. Wholesale and B2B distributors use it to expose unprofitable customers, routes, and order profiles that revenue-only scorecards hide.

Track by customer segment, DC, and route so ops and finance reconcile on one definition before margin reviews.

> Cost-to-Serve = Total distribution cost allocated to orders (or customer) / Number of orders (or units) served

## How Infoveave Tracks Supply Chain KPIs

Infoveave's [supply chain analytics platform](/solutions/industry/supply-chain) pulls data from WMS, ERP, TMS, supplier portals, and carrier APIs to track **OTIF**, fill rate, FADR, pick accuracy, dock-to-stock, lines per hour, cost-to-serve, inventory turns, and perfect order rate across the full supply network. [Automated data pipelines](/platform/data-automation) refresh KPI feeds on a schedule or in near real-time, so procurement, distribution, and logistics teams always have current numbers — not last week's export — when making replenishment, routing, carrier, and customer profitability decisions.

## Get the complete list of Supply Chain KPIs

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