Understanding Your Distribution Center Metrics

We've all been there, thinking there was one last soda in the fridge only to open it and discover that we are to remain thirsty. It's bad enough when it happens to us at home, but when it happens to our distribution centers it can be devastating. Don't let a slippery memory throw off your business, instead, look at your metrics!

Using metrics to track the flow of a business is not a new concept nor does it need to be a complicated one. On the contrary, it has been used for centuries now with a fair amount of ease and with great success. Reach out to the Redwood team today and we can show you how to even streamline your own data collection process.

In the meantime, let's take a look at the various distribution center metrics that you should be tracking, and more importantly, why they're so valuable to your business.

Speed and Accuracy of Shipments

The ultimate goal of any distribution center is to make sure that orders are sent out in an appropriate and timely manner.

Late shipments can give your company a horrible reputation and cost you business in the future, making these details probably the most important distribution center metrics that you can keep your eye on. Just as detrimental and easy to track is the early completion of packed and shipped items. 

While it might seem good to be getting shipments out sooner, this can actually lead to a major headache; incomplete shipments or over-shipped goods.

While most customers certainly wouldn't complain about an overage of items as it only hurts the company... missing or incomplete yet shipped orders can lead to a very frustrating situation for your customers.

As simple as this may sound, it can and does happen even in the best of scenarios. Watching the metrics and tracking the accuracy of your shipments a bit more closely will help minimize the chance of this occurring.

Warehouse Woes No More

According to reports and many of those who work in the industry themselves, most warehouses are now working at or near their capacity, making the tracking of stock paramount.

The importance is two-fold as it keeps you from accepting orders that you cannot fulfill due to current stock and it will also let you know if you have any items that are simply just taking up shelving space but not moving. However, just because an item doesn't move most of the year doesn't mean it should be completely de-stocked as tracking peaks in traffic is just as valuable for your business. 

A growing number of distribution centers are still integrating RFID technology to monitor inventory in the blink of an eye. But even the most sophisticated systems can still have bugs and human input is still valuable when calculating overall numbers.

So far most of these parameters can easily be tracked with any TMS service, but there are other metrics that can give you an idea of where your business is heading that venture into more personal and human-interaction based areas.

The Human Metric

Sadly, distribution centers tend to have high turnover rates. This may be due, in part, to a high workload unevenly distributed among certain employees.

Retaining a solid team of skilled employees is a key to success and every effort must be taken to ensure the happiness and continued productivity of the workforce. Between analyzing all of the other data at hand and communicating with your workers, solutions can be found to address just about any issue that your warehouse might face in this regard. But if it is allowed to go unnoticed and not monitored properly, your workforce can completely destroy your business. And in the worst-case scenario... your brand.

It is important to remember that no matter how big your business may be, at the end of the day your employees are the lifeblood of your business. Without them, none of it would be possible. Monitor employee metrics, find ways to boost morale and continue to set milestones for your team.

Adding it up

Knowing exactly where your business stands with stock, shipment timing, and employee data are vital to running a successful distribution center.  

Hopefully, you now have some idea as to the importance of all the spreadsheets and data you are sure to accumulate through these metrics.

While it may seem daunting at first to track all of these different metrics, using a service that offers a full TMS will streamline the process. Whether you've been using the advantages of the digital age for a while or just getting up to speed watching these key distribution center metrics will ensure a bright future for your venture.