Formula
Supply Chain Efficiency = (Total Goods Delivered On Time ÷ Total Goods Ordered) × 100
Calculation Example
If 9,000 out of 10,000 shipments are on time, Efficiency = (9,000 ÷ 10,000) × 100 = 90%
Data Source
ERP Systems, Logistics Software, Supplier Reports
Tracking Frequency
Monthly, Quarterly
Optimal Value
Higher is better; above 90% is ideal.
Minimum Acceptable Value
A low percentage suggests bottlenecks in the supply chain.
Benchmark
Industry benchmarks: Retail ~85-95%, Manufacturing ~80-90%, Healthcare ~90-98%
Recommended Chart Type
Bar chart (to compare supplier performance), Line chart (to track trends)
How It Appears in Reports
Displayed in operations reports to evaluate logistics effectiveness.
Why Is This KPI Important?
Indicates how well a company manages procurement, production, and distribution.
Typical Problems and Limitations
May not account for external factors like weather disruptions or port delays.
Actions for Poor Results
Improve supplier relationships, optimize inventory levels, enhance transportation logistics.
Related KPIs
Order Fulfillment Time, Inventory Turnover, Downtime Rate
Real-Life Examples
A manufacturer increased supply chain efficiency from 85% to 93% by using AI-driven demand forecasting.
Most Common Mistakes
Focusing only on efficiency without ensuring cost-effectiveness.
