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Finest 40+ Stock KPIs and Metric Examples for Reporting

Stock KPIs and metrics are essential elements of the reporting course of. Any enterprise that holds and distributes inventory must have the means to trace its well being and efficiency.

Stock KPIs present companies with correct data to make data-driven choices. They assist monitor stock ranges, monitor deliveries, and supply actionable insights in regards to the effectivity of the warehouse or storage services. When gathered accurately, you may as well use stock KPIs to research and enhance operations.

Why Stock KPIs and Metrics Are Important for Reporting?

Good reporting means that you can monitor the well being of your operation. Monitoring your efficiency and productiveness is instrumental in figuring out and enhancing your course of. Listed below are among the advantages of utilizing stock KPIs for reporting:

#1. Improved effectivity

Monitoring stock KPIs and metrics permits companies to establish areas of their enterprise that want enchancment and a spotlight. Metrics assist give administration the complete image of operations they should make impactful choices.

#2. Scale back prices

Provide chain disruption, excessive inflation, and rising warehouse rental prices have elevated working prices. It’s not all the time attainable to go these prices onto prospects. Monitoring KPIs may help scale back outgoings, spoilage, and shrinkage and drive down overheads.

#3. Improve buyer satisfaction

Warehouse and distribution effectivity performs a significant function in buyer satisfaction. Bettering your operations results in faster and extra correct turnarounds and deliveries, which in flip
improves buyer retention.

#4. Enhance worker retention

Worker retention is a urgent challenge for a lot of warehouses. The rise of eCommerce has led to a scarcity of excellent warehouse employees, with excessive turnover charges turning into normal. Monitoring security and worker satisfaction may help create a greater atmosphere that each attracts and retains staff.

Beneath, we’ll share among the finest stock KPI examples that you need to use to measure the efficiency of your warehouse or facility.

We’ve damaged down the stock KPI examples into 5 distinct classes:

  • Gross sales stock KPIs
  • Operational stock KPIs
  • Receiving KPIs
  • Worker KPIs
  • Security KPIs

Taken individually, they will present a take a look at of the power of various phases of your operation. Collectively, they can provide a strong studying of your operation’s well being.

Gross sales Stock KPIs

1. Product Gross sales

Product gross sales are a significant a part of reporting. It’s one of the vital highly effective stock KPIs.

You may work product gross sales out with the next system:

Product gross sales = gross income from gross sales – (returns + reductions + allowances)

You may run this metric over days, weeks, months, or years. It offers you an thought of the general profitability of a selected line or your whole inventory.

2. Stock Turnover Ratio

Your stock turnover ratio measures how briskly inventory is turned over, sometimes in a yr. Nonetheless, you need to use it over any time-frame.

An easy solution to calculate this metric is by first discovering your common stock worth.

You may calculate this by getting:

(opening stock worth + closing stock worth) / 2

Then take that quantity and work out:

Stock turnover ratio = (whole price of products offered / common stock worth)

Stock turnover is a superb solution to calculate how environment friendly your stock administration processes are. Nonetheless, it’s essential to strike a steadiness. In case your turnover price is just too low, it’ll have an effect on your order success, resulting in a lack of income and prospects.

3. Inventory to Gross sales Ratio

Inventory to gross sales is likely one of the finest stock KPIs to assist decide optimum inventory ranges.

Inventory to gross sales ratio = (Items obtainable / Items offered)

An excessive amount of stock prices assets to retailer, plus it’s essential to take into account alternative prices of capital you could deploy elsewhere. Once more, that is about placing a steadiness: if the ratio is just too low, you’ll seemingly run out of inventory.

4. Inventory Availability

Inventory availability is a good stock administration KPI for monitoring what share of your inventory is definitely obtainable for purchasers to buy.

Inventory availability = (inventory obtainable to promote / inventory in catalog) X 100

Low inventory availability may point out inefficiencies in your warehouse, resulting in storage prices which can be hurting income.

5. Days to Promote Stock / Days on Hand

Days to promote stock is an effective metric for measuring how lengthy you maintain stock, or to place it one other method, how lengthy it takes you to promote objects.

You may calculate this KPI as follows:

Days to promote stock = (Common Stock / Value of Gross sales) x 365

The decrease the times to promote stock quantity, the extra effectively your items are being moved. After all, what constitutes quantity depends upon what objects you promote. It’s price benchmarking towards comparable objects when deciding if the determine is excessive. Many high-ticket merchandise promote at a slower price.

6. Weeks on Hand

Weeks available is an effective stock gross sales metric that’s just like days available. You should utilize it to calculate the speed at which stock is transferring by means of your warehouse.

The system is:

weeks available = (common stock / price of products offered) x 52

When weeks available are excessive, it implies your stock is transferring too slowly. With cupboard space occupied, you incur alternative prices and better charges. A low week available suggests your inventory is transferring shortly.

7. Backorder Price

Backorder price is likely one of the finest stock metrics for figuring out how nicely your success course of works. It measures the share of orders that you simply can’t fulfill. As talked about above, if this quantity is excessive, it’ll critically hurt your revenues as you miss out on gross sales.

Backorder price = (variety of undeliverable orders / whole variety of orders ) x 100

You should utilize this throughout your whole line of merchandise or particular person objects.

8. Price of Return

The speed of return is likely one of the easiest KPIs for stock.

As urged, it calculates how continuously offered objects are returned for a wide range of causes.

To work out this metric, you need to use the next system:

Price of return = (variety of models offered / variety of models returned) x 100

Ideally, your price of return ought to be as little as attainable. Nonetheless, it’s not possible to maintain it at 0%. Some industries and merchandise have larger charges of return than others, like clothes.

Understanding this determine can inform you numerous about which product traces are consuming into revenues. Moreover, it may well spotlight issues with sending out the improper objects too.

9. Promote-through Price (STR)

The sell-through price (STR) is likely one of the finest stock KPIs for measuring the effectivity of your provide chain. It compares the quantity of stock acquired from a producer with the quantity of stock offered.

Promote-through price = (variety of models offered / variety of models acquired) x 100

You may measure the sell-through price weekly, month-to-month, or yearly. It’s a wonderful metric for measuring how in style (or unpopular) a selected product is.

Moreover, when mixed with storage prices metrics, it can provide you an entire image of the particular prices of holding a selected product.

10. Accuracy of Forecast Demand

Forecasting is an important a part of reporting. Nonetheless, it is best to take a look at these predictions for reliability once in a while. The accuracy of the forecast metric offers you an thought of how assured you might be in your projections of how nicely a selected merchandise will promote.

Accuracy of forecast demand = [(actual demand – forecast demand) / actual demand] X 100

Understanding the accuracy of forecast demand may help your operation considerably. When you discover that your forecast is off significantly, it means that it’s essential to evaluation your calculations. Whether it is off by a low share, you possibly can construct the distinction into your subsequent forecasts.

11. Common Income Per Unit

Common income per unit is likely one of the finest stock KPIs for subscription companies. Because the title implies, this stock KPI can inform you how a lot revenue you might be producing for every unit.

Common income per unit = whole income for time interval / common models offered for time interval

You may measure common income per unit over weeks, months, or annual. Moreover, it’s a helpful metric for subscription companies to see how a lot income every person or subscription brings in.

12. Value Per Unit

Value per unit is likely one of the strongest stock KPIs for companies that both make or promote a considerable amount of a selected merchandise. You too can use it in case your group orders and sells custom-made objects.

Value per unit = (fastened prices + variable prices) / variety of models produced

You should utilize price per unit along side different metrics to calculate income and total monetary well being. For companies who primarily promote one product, it’s an important reporting KPI.

13. Gross Margin by Product

Gross margin by product is likely one of the most useful stock KPIs for measuring income on a product-by-product foundation.

Gross margin by product = [(net sales of product – cost of product) / net sales of product] x 100

This metric is versatile sufficient that you need to use it to guage gross margins on objects your online business produces or buys. When mixed with the variety of models offered, gross margin by product can point out if holding a selected product is worth it.

Equally, it may well reveal which objects you may benefit from selling extra extensively.

14. Gross Margin ROI

Gross margin return on funding (ROI) is likely one of the finest stock metrics for understanding the effectivity of shopping for and promoting merchandise. Primarily, it measures how a lot income a enterprise makes in comparison with the sum of money it invests in merchandise.

Gross margin ROI = gross margin / common stock prices

Calculating gross margin ROI may help you resolve which merchandise or traces are over or underperforming. This data may help you resolve on future funding methods.

15. Buyer Retention/Loyalty

Buying new prospects is much dearer than retaining your present person base. Focusing in your current prospects is an important technique for measuring the general efficiency of your service.

You may calculate buyer retention with the next system:

Buyer retention/loyalty = [(customers at end of period – customers acquired) / customers at start of period) / 100

While inventory managers aren’t wholly responsible for customer retention, they have a critical role to play in the customer’s overall happiness. Low retention rates should be investigated and remedied where possible.

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Operational Inventory KPIs

16. Production Lead Time

Product lead time is one of the most helpful inventory metrics. It measures the amount of time between placing a purchase order and receiving the item.

You can calculate lead time using the formula:

Production lead time = purchase order procession time + production time + purchase order fulfillment time + supply chain delay

Of course, depending on which goods you sell, production time might not be applicable. Ideally, the lead time should be as low as possible. However, the number will vary based on the complexity of products, especially custom-ordered goods.

Many manufacturers require down payments on a purchase order. Long production times mean this capital is tied up, which means you incur an opportunity cost.

17. Perfect Order Index

The perfect order index is one of the best inventory management KPIs for evaluating customer satisfaction. It measures what percentage of orders go out without delays, damage, or inaccuracies. While 100% is challenging to achieve, it should be the goal for every company.

Perfect order index = (% of orders delivered on time X % of orders complete X % of orders damage-free X % of orders with accurate documentation) x 100

A low perfect order index suggests serious issues. Each individual component should be examined and reviewed regularly to improve the efficiency of your process.

18. Inventory Shrinkage

Inventory KPIs, like inventory shrinkage, are excellent measures of the performance of the warehouse. Essentially they measure the difference between expected and actual stock levels.

Inventory shrinkage = (recorded Inventory – actual Inventory) / recorded Inventory

A high inventory shrinkage rate can indicate several things. For example:

  • inadequate accounting
  • lost or misplaced inventory
  • theft
  • damage

Any of the above suggests wasted money. A high rate should trigger an investigation to stem the damage to revenue.

19. Deadstock

Deadstock is a valuable inventory KPI for calculating unsold stock that is unlikely to find a buyer in the future. Excess deadstock is bad for business as it represents capital that has been wasted and incurs storage costs.

Deadstock = expected or average product lifestyle vs. time in inventory

When time in inventory goes over the threshold, it is at risk of being classified as deadstock. When combined with market research on specific products, an excess can suggest this product won’t shift.

20. Safety Stock

Some KPIs for inventory help define how well your business can defend itself against the unexpected. Sometimes particular items experience a surge in demand or supply chain disruption.

Inventory forecast numbers are meant to predict demand. However, they can’t always account for factors outside your control. Supply-chain disruption since the COVID-19 pandemic is one such example.

You can calculate these KPIs for inventory uses the following formula:

Safety stock required = (max daily usage x max lead time) – (average daily usage x average lead time)

Understanding this number allows businesses to gauge how much extra stock they need on hand to ensure they don’t run low on supply and miss out on revenues or cause low customer satisfaction levels.

21. Order Accuracy

Order accuracy is one of the best inventory KPIs for tracking how well your warehouse is doing at picking, packing, and dispatching orders.

To calculate this number, use this formula:

Order accuracy = (number of accurately fulfilled orders / total number of orders) x 100

You can use this formula to determine your overall accuracy or the accuracy of individual pickers.

22. Holding Costs

Holding costs is one of the most critical inventory KPIs. It is a measure of how much it costs to store and protect unsold stock. Calculating this metric is key to defining the fundamentals of your operation.

There are two primary choices an inventory business needs to make:

  • Renting their own warehouse
  • Using a third-party fulfillment center

Working out the holding costs for both is a big part of making those choices.

Inventory holding costs = (storage Costs + worker salaries + opportunity costs + depreciation costs) / total value of annual inventory

There are several different ways that businesses can lower these costs. Renting your own warehouse and staff can be more cost-effective for more significant operations.

23. Lost Sales Ratio

Lost sales ratio is one of the best inventory management KPIs for measuring whether you are running to lean on stock. The metric looks at how many days a particular item is out of stock compared to the expected sales of the product.

Lost sales ratio = (total number of days a product is out of stock / 365) X 100

While running a lean supply chain eliminates holding costs, a high lost sales ratio can indicate an overly cautious approach. Additionally, being out of stock can cause a dip in consumer confidence and even drive customers to a competitor.

Using the lost sales ratio in conjunction with gross profit per item and costs to hold inventory can help you decide how much stock you should hold.

24. Service Level

Service level measures the percentage of customers who aren’t affected by out-of-stock issues.

Service level = (number of orders delivered / number of orders received) / 100

This metric is important for calculating how well your business can balance inventory storage costs with lost sales.

25. Average Inventory

Average inventory is a way to measure how much stock you have on hand over a particular period.

Average inventory = (inventory at start of period + inventory at end of period) / 2

Average inventory is one of the most straightforward inventory management KPIs for ensuring consistent stock levels. While even levels are essential, some seasonal businesses can tolerate variation.

26. Customer Satisfaction Score (CSAT)

A customer satisfaction score (CSAT) is a simple yet effective inventory KPI for judging how happy your customers are with your overall service. You can get these numbers by asking customers to respond to surveys or by compiling online ratings.

Customer satisfaction score = (number of positive response / total number of responses) X 100

A low customer satisfaction score indicates problems with your processes. Negative responses should trigger a review that seeks to remedy specific issues highlighted by customers.

27. Percentage of Sold Products Within Freshness Date

The percentage of sold products within freshness dates is a handy inventory management KPI for businesses that sell perishable goods. You can use this metric over a specific time period to help determine accurate stock levels and reduce spoilage and waste.

Percentage of sold product within freshness date = (items sold within expiry data / total items sold) X 100

A low percentage of inventory sold within the freshness date clearly indicates that your demand forecast is inaccurate. As well as wasting precious storage space, you are losing money by discarding expired goods.

To remedy this issue, calculate a safety stock buffer and reduce the number of items bought to a satisfactory level.

28. Percentage of Warehouse Occupancy

Percentage of warehouse occupancy is an essential inventory KPI metric for measuring the ROI of your investment in your facility.

Warehouse occupancy rate = (sq ft of warehouse space used / total warehouse sq ft) X 100

If your occupancy rate is low, it suggests that you aren’t making full use of your warehouse capacity. You should monitor this metric carefully because you are still paying for the unused space. The total percentage could also indicate you need a smaller or larger facility.

Receiving KPIs

29. Time to Receive

The time to receive metric is related to production lead time. Where lead time measures the overall process, time to receive looks at your end of the task: taking in the goods.

Time to receive = (time for stock validation + time to add stock to records + time to prep stock for storage)

This inventory metric is vital for measuring your part of the process. Again, a lower time is better. Anything excessive could signify wasted work hours or significant inefficiencies in your approach.

30. Put Away Time

Put away time refers to how long a particular stock takes to be put away (in minutes and hours) after being received and prepped.

Put away time = total time to store received stock

When used with production lead time and time to receive, you have a granular way to look at your entire stock receiving process.

This data can power improvements in your process by helping identify bottlenecks.

31. Putaway Accuracy Rate

Putaway accuracy rate is a good inventory management KPI for measuring your putaway process. It measures the percentage total of items that are stored accurately.

Putaway accuracy rate = inventory put away accurately / total inventory put away

Ideally, this number will be close to 1 or 100%. A low putaway accuracy indicates inefficiencies that likely cost you work hours in finding misplaced inventory.

32. Fill Line Rate

Fill line rate is one of the best inventory metrics for monitoring both order fills, and line fills.

Fill line rate = [(number of total items – number of shipped items) / number of total items] X 100

Fill line price is a superb solution to measure your order success course of. You should utilize it to measure the efficiency of a single supply or total supply.

33. Receiving Effectivity

Receiving effectivity is likely one of the finest stock administration KPIs for measuring the productiveness of your workforce.

Receiving effectivity = quantity of acquired stock / variety of employees hours

A low receiving effectivity is an indication that your inventory receiving course of must be reviewed or your employees wants help or further coaching.

34. Order Cycle Time

Order cycle time is likely one of the higher stock administration KPIs for measuring how lengthy a enterprise takes to satisfy a buyer order.

Order cycle time = (time order was acquired by the shopper – time buyer positioned the order) / whole variety of shipped orders

This metric supplies a sound oversight of your total course of. It could actually present helpful insights into how nicely your warehouse can meet buyer calls for whereas additionally making an allowance for supply and delivery metrics.

35. Value of Receiving Per Line

The price of receiving per line is a superb stock KPI for understanding the period of time invested in receiving objects from distributors. It elements within the dealing with and recording of every merchandise.

Value of receiving per line = whole price of receiving / whole variety of line objects

A excessive price of receiving per line may point out inefficiencies in your provide chain or issues with employees or distributors.

36. Receiving Cycle Time

Receiving cycle time is likely one of the most helpful stock administration KPIs for evaluating the general prices of taking in, recording, sorting, and categorizing your inventory.

Receiving cycle time = time spent receiving inventory / variety of objects acquired

This metric can spotlight traces that must be reviewed for effectivity. Inventory that takes many work hours to obtain and type can eat into income.

Worker KPIs

Worker KPIs are a measure of how productive your employees is. These Stock KPIs are a helpful solution to decide how labor hours are used.

37. Unit Labor Value

Unit labor price measures what it prices for a enterprise to provide one unit. This metric contains how a lot it prices to maneuver an merchandise by means of a facility, together with the employee’s wages.

Unit labor price = variety of whole models / whole labor prices

If organizations can improve productiveness and drive down these prices, they will go on the financial savings to their prospects.

38. Unit Labor Value Per Hour

Unit labor price per hour is just like unit labor price however is extra granular. Whereas each these stock KPIs are helpful, unit labor price per hour may help stock managers perceive the easiest way to make use of their worker’s time.

Unit labor price per hour = (employee’s gross annual wage / variety of weeks worker works / variety of hours per week worker works)

With a powerful understanding of what every hour of labor prices, managers can make sure that every hour is spent on productive duties.

These stock metrics are a great way to know the prices of downtime, whether or not due to system failure, conferences, lateness, or every other cause an worker might not be spending time on their core duties.

39. Worker Turnover Price Share

Worker turnover price is likely one of the finest stock KPIs for monitoring points inside your warehouse. Whereas some attrition is to be anticipated, excessive charges might counsel an issue that must be addressed.

Worker turnover price share = )workers who’ve left / common variety of workers) X 100

When an worker leaves, you will need to prepare a brand new worker. The time it takes them to settle and rise up to hurry together with your processes can hurt effectivity. A excessive turnover price suggests your group is just not working at whole capability for big parts of the yr.

Security KPIs

Any full report on the standard of your stock administration ought to discover room for security KPIs. Offering a secure working atmosphere is essential for retaining employees and mitigating downtime and attendant prices resulting from unsafe practices.

40. Days Since Final Accident

Time for the reason that final accident is a superb solution to measure warehouse security. It’s a quite simple calculation.

Days since final accident = present date – whole days since final accident

Ideally, you need this quantity to be as excessive as attainable. A excessive quantity will give your employees confidence and point out that you simply take their security critically.

41. Accidents Per Yr

Accidents per yr are one of the vital simple stock KPIs. You merely depend the variety of accidents that happen per calendar yr.

Benchmarking this quantity towards different years is vital to get a really feel for the way your security procedures are performing. An increase in accidents is an apparent trigger for concern and ought to be addressed instantly.

42. Time Misplaced Resulting from Harm

Time misplaced resulting from damage is an important metric for monitoring the implications of office accidents.

You may calculate this metric with a easy system:

Time misplaced resulting from damage = time misplaced in hours / whole variety of hours

Calculating these figures helps consider the prices of poor security procedures and may present a concrete profit for investing in higher security practices.

This checklist of stock KPIs that we lined on this put up was pretty intensive, and when you don’t keep in mind all of them, that’s positive. Nonetheless it is best to attempt to keep in mind the stock KPIs which can be related to your business and learn how to effectively monitor them utilizing enterprise intelligence software program. When you’ve got any questions on BI software program or KPI dashboards, get involved with insightsoftware at the moment!

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