Must-Know Distribution Kpis [Latest Report]

Highlights: Distribution Kpis

  • 1. Inventory Turnover
  • 2. Order Cycle Time
  • 3. Order Picking Accuracy
  • 4. On-Time Delivery
  • 5. Order Fill Rate
  • 6. Carrying Costs
  • 7. Perfect Order Rate
  • 8. Obsolete Inventory
  • 9. Order Visibility
  • 10. Shipment Accuracy
  • 11. Dock-to-Stock Time
  • 12. Stock Availability
  • 13. Return Rate
  • 14. Transportation Cost per Unit
  • 15. Warehouse Utilization

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In today’s rapidly evolving business landscape, the proper evaluation and measurement of distribution success has become increasingly paramount for organizations spanning across industries. Distribution Key Performance Indicators (KPIs) serve as an essential tool in this pursuit, enabling businesses to assess, fine-tune, and optimize their distribution processes and strategies, ultimately driving efficiency and ensuring a competitive edge.

In this thought-provoking blog post, we will delve into the importance and relevance of Distribution KPIs, shedding light on their indispensable role in effectively managing supply chain performance, improving customer satisfaction, and ultimately fulfilling the overarching strategic objectives of an organization.

Distribution KPIs You Should Know

1. Inventory Turnover

The number of times a company sells and replaces its inventory within a given period. It measures the efficiency of inventory management and indicates the health of the distribution process.

2. Order Cycle Time

Measures the total time taken from receiving an order to delivering it, reflecting the efficiency of the order fulfillment process.

3. Order Picking Accuracy

Represents the percentage of accurately picked items from the warehouse, impacting customer satisfaction and overall distribution costs.

4. On-Time Delivery

The percentage of orders that are delivered to the customer within the agreed-upon time frame, positively affecting customer satisfaction and retention.

5. Order Fill Rate

Represents the percentage of total customer orders fulfilled from available inventory without any backorders. A higher fill rate indicates an effective distribution system.

6. Carrying Costs

The costs associated with holding, storing, and managing inventory. A well-managed distribution system strives to minimize carrying costs without sacrificing order fulfillment capabilities.

7. Perfect Order Rate

Measures the percentage of orders delivered without any errors, such as incorrect items or damages. A high perfect order rate is a sign of an efficient distribution process.

8. Obsolete Inventory

Represents the percentage of non-saleable inventory in the distribution center. Reducing obsolete inventory helps control carrying costs and improve profitability.

9. Order Visibility

Refers to the extent to which customers and the company can track an order in real-time. Enhancing order visibility improves customer satisfaction.

10. Shipment Accuracy

Measures the proportion of shipments delivered accurately, reflecting the competency of pick, pack, and ship processes.

11. Dock-to-Stock Time

Represents the time taken to move items received at the dock to the appropriate storage location in the warehouse, reflecting warehouse efficiency.

12. Stock Availability

Refers to the percentage of time a specific product is available in stock. High stock availability ensures customer satisfaction and smooth order fulfillment.

13. Return Rate

Represents the percentage of items returned by customers. Lower return rates reflect higher customer satisfaction, better product quality, and a well-functioning distribution system.

14. Transportation Cost per Unit

Captures the average amount spent on shipping each unit to the customer, impacting distribution cost efficiency and overall profit margins.

15. Warehouse Utilization

Measures the percentage of warehouse space being effectively used for inventory storage, indicating how well the facility’s capacity is being utilized for distribution.

Distribution KPIs Explained

Distribution Key Performance Indicators (KPIs) play a crucial role in assessing and optimizing the overall efficiency, effectiveness, and customer satisfaction of a company’s distribution network. Metrics such as Inventory Turnover, Order Cycle Time, Order Picking Accuracy, On-Time Delivery, and Order Fill Rate provide insights into how well the distribution process is being managed, which in turn affects profitability and customer satisfaction.

Additionally, KPIs such as Carrying Costs, Perfect Order Rate, Obsolete Inventory, Order Visibility, Shipment Accuracy, Dock-to-Stock Time, Stock Availability, Return Rate, Transportation Cost per Unit, and Warehouse Utilization help companies identify areas of improvement to minimize costs, streamline processes, and ultimately enhance overall distribution performance.

By monitoring and acting upon these important KPIs, businesses can efficiently manage their inventory, improve order fulfillment capabilities, and maintain high levels of customer satisfaction while reducing costs and maximizing profits.


In summary, understanding and tracking your distribution KPIs is essential for gauging the success and effectiveness of your marketing strategy. By closely monitoring these key performance indicators, you will be well-equipped to make data-driven decisions, optimize your campaigns, and ultimately achieve better results in reaching and engaging your target audience.

As the digital landscape continues to evolve, staying ahead of the curve by consistently analyzing and adjusting your distribution KPIs ensures that your brand remains relevant and competitive in today’s fast-paced business environment. Embrace these metrics and use them to drive your marketing efforts toward greater success and growth for your organization.


What are Distribution KPIs and why are they important?

Distribution KPIs (Key Performance Indicators) are metrics used to evaluate the efficiency and success of your distribution process in delivering products to customers. They are important as they help companies identify areas of improvements, optimize operations, reduce costs, and increase customer satisfaction.

What are some examples of Distribution KPIs?

Examples of Distribution KPIs include order fill rate, on-time delivery rate, order cycle time, distribution cost per unit, and inventory accuracy. These KPIs help determine if your distribution system is meeting its objectives and highlight potential areas for improvement.

How do you establish an effective set of Distribution KPIs?

To establish an effective set of Distribution KPIs, you should first define your distribution objectives, such as reducing costs or improving customer service. Then, identify the critical metrics that reflect those objectives, ensuring that they are quantifiable, actionable, and relevant. Finally, assign suitable targets and continuously monitor and review the KPIs to make necessary adjustments.

How should KPI targets be set for maximum impact?

KPI targets should be set based on a combination of historical data, competitor benchmarks, and your company's overall goals. Targets should be realistic, achievable, relevant to the business context, and consistent with industry standards. Revisiting and adjusting targets when necessary helps ensure that they continue to drive performance improvements.

How can Distribution KPIs be used to improve supply chain management?

Distribution KPIs can be used to identify inefficiencies in the supply chain, revealing potential areas for cost reduction and process improvements. By monitoring these metrics, organizations can gain insights into warehouse management, transportation optimization, demand and inventory forecasting, and customer service performance. This, in turn, enables companies to make data-driven decisions and devise effective strategies to enhance their overall supply chain effectiveness.

How we write our statistic reports:

We have not conducted any studies ourselves. Our article provides a summary of all the statistics and studies available at the time of writing. We are solely presenting a summary, not expressing our own opinion. We have collected all statistics within our internal database. In some cases, we use Artificial Intelligence for formulating the statistics. The articles are updated regularly.

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