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9 Key Topics to Understand to Frame A Shipper’s Mind for Effective KPI Management with a 3PL

GlobalTranz

This is the first post in an ongoing series on effective KPI management from third party logistics consultant, Chuck Intrieri, of The Lean Supply Chain. . How does an SLA work with Key Performance Indicators (KPIs)? The more KPIs, the more difficult the negotiation process. All KPIS have a target percentage to meet.

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Managing a Third Party Logistics Partnership

The Logistics of Logistics

When you have chosen a 3PL partner, insure that you have an effective Service Level Agreement (SLA) with accompanying Key Performance Indicators (KPIs) to manage the Service Level of the 3PL. This SLA/KPI has to be negotiated and agreed upon by you and your 3PL partner.This negotiation time can take three (3) to Six (6) months.

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Service Level Agreement Defined

The Logistics of Logistics

In my opinion, a service level agreement should be used in any customer-3PL engagement. It states that certain KPIs in this QBR are to be negotiated/reviewed monthly. Sometimes, the Logistics provider has their own SLA/KPI that they want to use with any customer, but negotiation is still in order. How do you write an SLA/KPI?

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What Should Be in My Logistics KPIs Scorecard?

Intelligent Audit

Here are some key areas that transportation leaders can benefit from monitoring: On-time delivery measurements— The number one metric to track and record is how many orders overall are delivered on time and without issue. Optimizal Carrier Usage – Mode selection is another tricky KPI. appeared first on Intelligent Audit.

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The Best LTL KPI for Measuring Freight Damage

The Logistics of Logistics

The best LTL KPI for measuring damaged shipments is simply the percentage of damage free shipments delivered. Cost, on time performance and billing accuracy don’t mean much if the carrier damages the freight. To minimize freight damage, begin measuring it with the damage free shipments KPI. damage free shipments.

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The Best LTL KPI for Measuring Cost

The Logistics of Logistics

The best LTL KPI for measuring cost performance is cost per pound. The less than truckload (LTL) cost per pound KPI is easy to calculate (see below). The LTL cost per pound is also completely transparent (can’t tweak the numbers) and it provides great insights into a company’s freight spending. Additional Reading on LTL KPIs.

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The Best LTL KPI for Measuring Billing Accuracy

The Logistics of Logistics

The best LTL KPI for measuring billing accuracy is simply the percentage of accurate bills. Incorrect freight bills drive the accountants crazy and drive the costs up. Sometimes it has to be passed on to clients, who were already billed for freight or the added cost has to be absorbed by the shipper.

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