Measures of Efficiency in a Warehouse

Service levels:

  • Percentage of orders dispatched on time;
  • Percentage of orders fully satisfied (i.e. all order lines supplied);
  • Accuracy of order fill;
  • Stock availability in the warehouse;
  • Order lead time;
  • Returns and customer complaints.

Operational efficiency:

  • Number of cases picked per person per hour;
  • Number of order lines picked per person hour;
  • Equipment uptime (e.g. percentage hours equipment available, with no breakdowns or routine maintenance).

Cost efficiency:

  • Cost per case throughput;
  • Cost per pallet stored;
  • Conformance to budget (e.g. for staff costs, rent, equipment maintenance, packing materials).

Resource utilization:

  • Percentage pallet storage capacity used;
  • Number of hours per day equipment is used (e.g. sorters or narrow-aisle trucks) – although note that high utilizations may prevent peak throughputs being achieved, so these measures need to be interpreted with caution;
  • Number of standard hours worked.

Stock integrity:

  • Percentage of locations with correct stock (i.e. in accordance with the computer records, as measured during a physical stock-take);
  • Percentage of SKUs with correct stock;
  • Stock-turn (i.e. annual throughput/average inventory level). This figure is also often represented as the number of weeks of inventory held in the warehouse (i.e. a stock turn of 10 equals 52/10 or 5.2 weeks of inventory in the warehouse).

Cycle times:

  • Average number of hours between arrival of goods on site and put away to storage location (i.e. available for replenishment or picking);
  • Average number of hours between customer order receipt and dispatch of goods.

Safety:

    • Number of days without an accident;



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