What are KPIs and what should we consider in the last mile

Los KPIs (KKey Performance Indicators) as their name says, are numerical performance indicators that allow us to identify possible positive or negative developments in our operations in order to measure and compare them. It also allows us to act accordingly to improve performance, creating planning and process optimization strategies.

In the case of the logistics sector, these indicators help to have knowledge of the company's processes and operations in order to work on the continuous improvement of the entire logistics chain, from warehousing to distribution.

These indicators help to make decisions about processes and to be clear about how the company's operations are working. That's why they are very relevant to the sector. They also allow us to make comparisons with certain historical moments or with reference metrics (for example from other companies) when carrying out a Benchmarking. Also they make it possible to reduce errors, reduce costs, optimize processes, enhance profitability and improve productivity.

There are different classes or categories of indicators:

Performance: they provide information on whether the execution of the scheduled activities is being carried out

Productivity: they allow us to compare real values with the objectives that were expected to be achieved, in a certain period of time.

Utilization: they allow us to measure how we use our resources. For example: number of used vehicles

To establish the KPIs we want to measure, we must take into account what the company's objectives and these indicators are. The process that is used for the operation must also be taken into account. On the other hand, reasonable and attainable objectives must be established, in order to then be able to make comparisons that work for the company. For this purpose, the SMART theory (Specific, Measurable, Attainable, Relevant and Time Based) is used, meaning that objective KPIs must be specific, measurable, attainable, relevant or realistic, and timely. As an example, we could say that “making more shipments” is not as SMART a goal as “increasing shipments by 5% in 6 months”. Objectives should be part of a planned strategy to achieve larger goals.

What are the KPIs that we should consider in last-mile logistics?

For the last mile sector, there are many indicators to consider. We'll tell you which are the most relevant to us:

Number of deliveries/stops made and canceled: can be measured per day (total), by zone or per driver.

Reasons for cancellation: establish the most common ones and measure the quantity of each one. Then you can analyze how to avoid these cancellations.

Delivery attempts: How many times was the visit carried out until it was completed

Used vehicles: quantity per day

Kilometers traveled: amount per day or per vehicle

Road time (hours): amount per day or per vehicle

Customer Satisfaction: it is measured through evaluation surveys sent to the customer

Staff/driver satisfaction: is measured through assessment surveys through the system used by drivers

Cost per km or delivery: can take into account different factors such as the price of fuel, the price of outsourcing the service, etc.

All of these KPIs can be analyzed day by day to improve operations and correct errors that may be happening in deliveries. In addition, many of them can be improved by optimizing routes such as the kilometers traveled and the number of vehicles used per day. This makes it possible to considerably reduce costs and also CO2 emissions.

With Routal Planner not only can you plan and optimize your routes in minutes, you can also view them in the Analytical all the KPIs relevant to your business, to be able to work on the continuous improvement of your processes and reduce your operating costs.

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