On-Time Shipping: why is it important for your business? (2024)

CONDIVIDI SU

On-Time Shipping is a key performance indicator (KPI) essential in logistics data that measures the percentage of orders shipped by or before the requested date. 

Keeping track of this KPI is very important to evaluate the efficiency of your supply chain and understand if there are problems within the fulfillment process that require immediate intervention. These could be issues related to bad planning or low performing systems. Identifying and addressing these problems is essential to maintain optimal customer satisfaction levels and a high quality delivery service.

 

The importance of maintaining optimal On-Time Shipping 

Maintaining optimal On-Time Shipping performance is beneficial to both retailers and customers. In fact, the repercussions of failing to meet delivery deadlines and delays in this context can lead to a significant rise in costs:

 

  • Increase in warehousing costs due to the need to stock more items and occupy more space, with a rise in risk of products becoming obsolete.

 

  • Market presence and brand reputation are negatively affected due to the inability to fulfill orders on time with consequent loss in sales.

 

Aside from monetary losses, the more profound effects lie in the erosion of trust and credibility. Therefore,businesses must understand how to leverage logistics data to enhance their on-time shipping rates and mitigate all these risks.

 

 

How do you calculate on-time shipping?

The formula to calculate on-time shipping is the following:

 

On-time shipping = (Number orders shipped on-time) / (Total number orders shipped) × 100



How to optimize On-Time Shipping

 

To enhance your business’s shipping efficiency and guarantee timely deliveries, consider the following aspects:

 

  • Select reliable shipping services 
  • Optimize inventory management
  • Streamline your order fulfillment workflow for increased efficiency
  • Invest in advanced technology and software for increased visibility and performance

 

Streamline operations

Investing in technology and automation to enhance fulfillment processes, from receipt to delivery, is the first step to reduce delays and the time taken to get orders ready for delivery to customers. Leveraging technology can, in fact, boost operational efficiency by automating fulfillment tasks, including the generation of shipping labels, inventory management, and shipment tracking, thereby improving accuracy, likelihood of errors, as well as hold-ups. Moreover, integrating shipping software with a company’s ecommerce further improves customer experience and order fulfillment journey by providing live shipping updates to keep customers informed and set realistic expectations.

 

Optimize inventory management

By leveraging eLogy’s Warehouse Management System (WMS), companies can achieve precise inventory control, generate accurate inventory reports and predict future demand. This advanced data storage and analysis performance, combined with automatic reorder notifications, will help prevent stock shortages, which are common causes of poor On-Time Shipping performance. This will guarantee you are always prepared to meet order demands. 

 

Strategic warehousing with eLogy

By storing stock strategically, near key markets or transportation hubs, businesses can significantly reduce lead and shipping times. This proximity directly impacts the ability to meet delivery deadlines. 

 

Integrate eLogy’s advanced analytics tools 

 

Technology also plays a fundamental role in offering analytical insights into the shipping process. By analyzing shipping and logistics data, businesses can identify areas where improvements are required and fine-tune their shipping strategies. For example, by analyzing historical shipping data, a company can identify patterns of delays linked to certain carriers or routes. eLogy’s real-time carrier performance tracking software allows you to automatically select the best performing carrier for each shipment, improving overall on-time shipping rates. Moreover, our Route Optimization Software automatically selects the most efficient route for every shipment, speeding up the delivery process and reducing waste. Finally, data analytics can reveal demand spikes patterns or predict future demand, allowing businesses to adjust inventory levels and staffing accordingly. 

 

How eLogy can help

Don’t make up your performance standards, compare your On-Time Shipping Performance KPI with that of your industry to gain a clear perspective of where you stand. Focus on it and, once you reach the benchmark, try and surpass it to increase your competitiveness! Achieving on time shipping and by extension timely deliveries for high customer satisfaction hinges on a robust and reliable logistics network. Partnering with eLogy means finding an all-in-one solution to boost your on-time shipping performance.