Key performance indicators (KPIs) are essential in identifying inefficiencies that drive up transportation costs.
But measuring too many metrics can be confusing and more trouble than it’s worth. With hundreds of KPIs, choosing the right ones for your business can be overwhelming. To make the most of KPIs, you must link them to your company’s goals and measure only the KPIs that truly matter.
So let’s look at a few transportation KPIs that will help you understand how your business is doing.
Measuring financial KPIs is critical for the growth and profitability of your company.
Examples of financial KPIs include:
- Revenue shows the overall financial performance of your operations.
- Cost per mile reveals opportunities to reduce costs and better understand your operating costs.
- Net profit measures overall profitability.
- Day sales outstanding (DSO) metrics measure the average payment days of your customers and help you understand cash flow and determine if you need to consider freight factoring.
- ROI helps you determine the profitability of your investments and whether they’re worth continuing.
Service KPIs help you determine the quality of your service and improve customer satisfaction.
Examples of service KPIs include:
- On-time performance (OTP) reveals bottlenecks in your operations.
- Transit time helps you gain an advantage in the market.
- Shipment accuracy helps you reduce the number of shipment errors.
- Response time helps you address customer inquiries and complaints promptly.
Process KPIs are essential in evaluating your operational efficiency and identifying areas to improve.
Examples of process KPIs include:
- Dwell time measures the time it takes for a shipment to move from one point to another within your network.
- Turnaround time shows the time needed to process a shipment from receipt to delivery.
- Capacity utilization reveals opportunities to optimize resources and reduce operating costs.
- Delivery density measures the number of shipments delivered per mile.
Dispatch and driver KPIs
Dispatch and driver KPIs are critical in knowing the efficiency and effectiveness of your operations.
Examples of dispatch and driver KPIs include:
- On-time pickup & delivery measures the percentage of shipments picked up and delivered on time.
- Hours of service (HOS) compliance measures the percentage of time your drivers follow federal hours of service regulations.
- Fuel efficiency shows when drivers need to optimize fuel usage and reduce fuel consumption to combat rising fuel costs.
- Driver turnover identifies trends and patterns to better understand why drivers leave the company and where you can make changes that will keep truck drivers happy.
Compliance-related KPIs ensure you’re operating within the legal and regulatory requirements.
Examples of compliance-related KPIs include:
- Measuring regulatory compliance helps you avoid tickets and fines.
- Audit scores show your company’s performance in safety audits and compliance inspections.
- Accident rate reveals areas where you need to improve safety measures to reduce the number of accidents per mile your fleet travels.
KPIs keep you on track
By adopting a holistic approach to KPI measurement and analysis, transportation companies can improve operations, increase profits, and stay ahead of the competition in an evolving industry.
Keeping up with your KPIs is easy when you have access to a transportation KPI dashboard to simplify analysis.
LoadOps, the intelligent TMS, helps you keep an eye on your KPIs and much more.