It is essential for shippers to be able to evaluate the strengths and weaknesses of their teams, partners, and overall operations. For this, mere assumptions aren’t enough. Let’s take a look at the 3 Key Performance Indicators (KPIs) every shipper must have… but usually don’t. And if they do have this information, it is usually spread across several documents and is hard to retrieve and use when decisions are being made. Read on to learn which KPIs you need and how to make them accessible.
1.Partner Performance Indicators
Having data on partners’ performance is something completely new to the shipping industry. It is something that can truly revolutionize the way partnerships are managed. Assessing the performance of carriers and forwarders helps shippers pick a partner who offers the best ROI.
Some KPIs that should be gathered for carriers include:
Respect of the volume commitments
Carrier’s booking confirmation response time
Percentage of container requests accepted and refused
Respect of the volume commitment
Number of cancelled bookings
The average difference between their estimated and actual time of departure and arrival
Planned vs actual availability
Creation of BL
Similarly, some of the KPIs for forwarders include:
Time taken to book a request after creating a shipment file
Time taken to make available a Bill of Lading after the cargo has departed
How fast booking requests are issued
Operational problem notification and transparency
Anticipating operational problems
Avoiding storage, demurrage, detention costs
When you have access to the right information, you also get the upper hand while negotiating. If your partner does not hold up their side of the deal, you can even ask for your money back.
2.General Performance Indicators
A logistic team’s general performance indicators will give you an idea of the overall way of functioning. The KPIs to look for include:
The volume of shipments handled per year/month/week
Container capacity remaining with the carrier/ forwarder
Balance of accounts
This information is also very beneficial to the accounting department. It offers a clear view of where resources are being spent, where they can be saved and where profit margins can be increased.
3.Internal Performance Indicators
Knowing how your team is performing helps you discover ways to motivate them and improve company performance. Some of the KPIs that can indicate this are:
Time spent on each task
Amount of work completed by each team member
Number of containers managed by each person
Access to internal performance indicators like the above can also tell managers where additional attention and training is required. In the long run, this can help strengthen the team and reduce unnecessary mishaps.
How KPIs Help Strengthen Your Operations
For shipping managers, these performance indicators are crucial to their progress. However, not all of them are easily available. In many cases, general performance indicators can be hard to come by in a comprehensive form. Manually managing the data in excel sheets is time-consuming and has a high risk of human error.
Hence, the importance of automated KPIs. This way, the moment something happens, it is recorded and the data can then be accessed by whoever needs it in real time. Suddenly, it makes data available and accessible.
KPIs, however, are only useful if data is constantly fueling them with reliable data. That’s why a collaborative platform, like BuyCo, is crucial to the process. It allows for data to be gathered organically with no manual entry. For example, KPIs can come directly from your carrier through an EDI. This assures the reliability of that data, rather than making decisions on KPIs furbished by your forwarder.
BuyCo’s collaborative platform offers all the KPIs listed above, as well as any personalized KPIs you might need. It is a platform that lets you fuel data naturally.
If you want to discover the power shipping KPIs can bring to your operations: