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Logistics KPIs: a guide to key indicators to monitor and optimize the supply chain

13.01.2026

In today’s business organizations, controlling operational productivity has become a critical priority. This is where the importance of KPI analysis comes into play. KPIs (Key Performance Indicators) are performance metrics that allow companies to measure their processes clearly and objectively through the collection of relevant data.

In the logistics sector, as in many others, KPIs have therefore become essential metrics for monitoring business performance: from procurement and warehousing to the distribution of goods.

In recent years, the significant increase in logistics costs has made it imperative for companies to find effective solutions to monitor and optimize their supply chain. In this context, logistics KPIs have quickly proven their value. A survey conducted by APQC, the American Productivity & Quality Center, revealed that companies implementing a structured KPI analysis are able to improve performance (according to 48% of companies), ensure quality and consistency (46%), optimize resource utilization (44%), reduce costs (44%), and increase revenues (33%).

Which logistics KPIs should be monitored most closely? To answer this question, we interviewed Enzo Cancian, CEO & HR at Stesi, who will guide us through the key performance indicators in logistics, from procurement to shipping.

»Without data, you’re just another person with an opinion«

KPIs: what are Key Performance Indicators in logistics?

»Before moving on to logistics KPIs,« Enzo Cancian points out, »it is necessary to define what Key Performance Indicators are«. KPIs are numerical values that measure the performance of specific business processes. These metrics are objective, critical, concise, meaningful, and prioritized, and for this very reason they make it possible to effectively evaluate company performance over time.

While all companies may focus on KPIs that measure costs, lead times, process quality, and volumes, in logistics KPIs reflect the different logistics phases, including goods receiving, storage, picking efficiency, inventory management, shipping, deliveries, transportation, and returns management.

These indicators, which are specific to a company’s operations (alongside other KPIs such as economic, financial, profitability-related, etc…) are fundamental for managing both tangible and intangible assets and are essential for limiting corporate risk. For effective business management, it is crucial to continuously monitor these indicators, as they can determine the success or failure of a company.

Logistics KPIs: what are they used for?

Logistic and warehouse KPIs play a fundamental role in business management, as they offer several key benefits:

• Planning activities and coordinating resources: by measuring expected flows, workloads, and queues, logistics KPIs enable precise planning of activities and resources, »both in terms of human resources and tools and equipment« as Cancian explains. This data-driven planning naturally improves operational efficiency.
• Monitoring activities and resources: logistics indicators allow continuous control of logistics operations, resources used, and organizational structures. Ex-post analysis of productivity, service levels, errors, and other critical parameters provides a detailed overview of process performance and highlights the need for timely corrective actions.
• Supporting analysis and continuous improvement: KPI indicators provide data that supports the analysis of logistics processes. This data is essential to identify critical issues and measure the results of reorganization initiatives, contributing to the overall improvement of the logistics organization.
• Engaging operators: the use of logistics KPIs helps involve operators in performance evaluation. »By linking achieved results to incentive systems,« Cancian explains, »operators are encouraged to actively contribute to the efficiency and success of the company«.

Keeping warehouse logistics KPIs under control allows companies to base logistics activities on real data, ensuring accurate planning, continuous process control, timely interventions, and ultimately an overall improvement of the entire supply chain.

»You can’t improve what you can’t measure«

KPIs in logistics: the different types

So, what are the most important KPIs for logistics? According to Enzo, the most relevant indicators for companies are those that »capture« the performance of the actual phases of the supply chain, namely: procurement, warehouse and inventory management, transportation and shipping, and reverse logistics returns. »With special attention,« Enzo adds, »to all sustainability-related indicators, which cut across all operational phases«.

KPIs for procurement and receiving (Inbound)

In logistics, the first phase to consider is naturally the procurement of inventory, whether raw materials, semi-finished products, or finished goods. To monitor and optimize this phase, some of the most important parameters include:

• SPI – Supplier Performance Index: often expressed as the rate of missed or failed deliveries, this KPI measures supplier quality and reliability by calculating the percentage of orders not received or rejected due to non-compliance with supply agreements.

• Supplier Compliance Level: although this KPI also monitors supplier reliability, it specifically takes into account the level of delivery delays for purchased goods received at the warehouse.

• Procurement Lead Time: among logistics indicators, this KPI measures the time elapsed between issuing a purchase order to a supplier and receiving the goods at the warehouse.

• Inbound Quality Rate: the percentage of received materials or products that comply with specifications and are ready for use without inspection, rework, or return. Why it matters: it represents one of the largest hidden costs. Defective inbound goods can halt production, cause rework, and generate returns to suppliers.
  Formula: (number of compliant lots received / total lots received) x 100.

Warehouse KPIs (Warehouse Operations)

To ensure effective warehouse management and organization, several KPIs are worth monitoring. According to Enzo Cancian, the most important ones are:

• Dock-to-Stock Time: the average time between unloading a truck and the moment goods are stored, recorded, and available for sale or production. It measures receiving efficiency.

• Unit Storage Cost: this KPI represents the ratio between storage costs and total warehouse capacity (or capacity used during a reference period), providing insights into warehouse holding costs.

• Warehouse Cycle Time: reflects the time required to receive, process, and ship an order. As Enzo highlights, it is very useful for assessing warehouse efficiency.

• Warehouse Space Utilization: this KPI shows the ratio between used and available warehouse space, providing valuable data for decisions on space reorganization or expansion.

• Picking Accuracy: the percentage of order lines or orders picked without errors (wrong product or quantity). It is directly linked to customer satisfaction and return costs.
  Formula: (number of lines with errors / total picked lines) x 100. Example: if out of 12,000 picked lines, 48 errors are recorded → (48 / 12,000) x 100 = 99.6%. A common alert threshold for picking accuracy is < 98%.

• OCT – Order Cycle Time: more specific than Warehouse Cycle Time, it is the average time from when an order is released to the warehouse to when it is packed and ready for shipment. It measures agility. An OCT below 4 hours for 100 items typically indicates a healthy, responsive warehouse. An alert threshold could be > 8 hours, potentially indicating bottlenecks in picking or packing.

• Lines Picked per Hour: measures operator or picking system productivity. It can be calculated per operator, team, or for the entire warehouse.

• MHE Utilization (Material Handling Equipment Utilization): indicates how intensively equipment such as forklifts or voice picking systems is used, helping to optimize capital investments.

Inventory KPIs (Inventory Control)

Given the importance of tracking and analyzing inventory movements along the supply chain, it is no surprise that inventory management involves several critical KPIs. According to Enzo, these KPIs enable more efficient and effective replenishment planning.

• Inventory Turnover: a warehouse KPI that reflects how many times inventory is replenished during a given period. It shows how often stored products complete the full operating cycle.
  Formula: cost of goods sold (COGS) / average inventory value.

• Stockout Rate: this KPI shows the percentage of orders that could not be fulfilled due to lack of inventory. The goal is to keep this KPI as low as possible to preserve customer satisfaction.

• Inventory Accuracy: indicates the percentage match between physical inventory and system-recorded inventory. Higher accuracy means more effective inventory management.
  Formula: (number of SKUs with correct counts / total inventoried SKUs) x 100.

• DIO – Days of Inventory Outstanding: the average number of days capital is tied up in inventory. It is a key bridge between logistics and finance and helps optimize cash flow. It answers the question: »with the inventory I have, for how many days can I meet demand?«. A good benchmark is typically between 30 and 60 days (highly industry-dependent). Indicative alert threshold: > 90 days.
  Formula: (average inventory value / cost of goods sold) x 365 (or days in the period).

KPIs for shipping and transportation (Outbound & Logistics)

»The second phase of the logistics process,« Enzo continues, »concerns the circulation and transportation of goods«. To fully understand and optimize this phase, it is useful to consider metrics such as:

• Transportation Cost per Sale: this KPI highlights the ratio between total transportation costs and sales, helping assess the sustainability of logistics expenses.
• OTDR – On-Time Delivery Rate: reflects the ratio between deliveries completed within agreed timeframes and total deliveries, indicating transportation efficiency and customer satisfaction. A typical alert threshold is < 90%.
  Formula: (number of on-time deliveries / total deliveries) x 100.
• Fleet Utilization Rate: this KPI can be measured by weight or volume and aims to monitor the saturation level of the transport fleet.
• First Attempt Delivery Success Rate: the percentage of parcels successfully delivered on the first attempt. It is a key KPI for e-commerce and last-mile logistics.
  Formula: (successful first-attempt deliveries / total initiated deliveries) x 100.
• Cost per Successful Delivery: more precise than transportation cost per sale, as it accounts for the cost of failed delivery attempts.
  Formula: total operating costs / number of successful deliveries.

Reverse Logistics KPIs (Returns)

Reverse logistics, often seen as a cost center, is actually a strategic area for customer retention and value recovery. Monitoring returns means optimizing a process that directly impacts profitability and sustainability. The following KPIs help turn reverse logistics into a competitive advantage:

• Return Processing Time: the average time between receiving a return at the warehouse and its final disposition (restocking, disposal, refund). Fast returns increase customer satisfaction and free up working capital.
  Formula: (number of processed returns / total returns received) x 100.

• RTV – Return to Vendor Rate: the percentage of received goods returned to suppliers due to non-compliance. It measures procurement quality and inbound inspection effectiveness.
  Formula: (value of goods returned to suppliers / total purchase value) x 100.

• ROR – Return on Recovery: the percentage of the value of returned goods that is recovered through resale, reuse, or recycling. It measures the financial effectiveness of reverse logistics processes.
  Formula: (recovered value from returns / total value of returns) x 100.

Sustainability KPIs

Today, logistics efficiency is no longer measured only in terms of cost and time, but also in terms of environmental impact. As Cancian clearly explains, »Integrating sustainability KPIs into your performance dashboard helps reduce waste, enhance corporate image, support compliance, and anticipate increasingly stringent and widespread regulations«. Let’s look at the main indicators that quantify the journey toward a more responsible supply chain:

• Carbon Emissions per Shipment: expressed in kg of CO2eq. Increasingly requested by B2B customers, end consumers, and stakeholders. As a common indicative target, a 5% annual reduction is an excellent starting point for this KPI.
  Formula: total transportation emissions in kg CO2eq / total number of shipments.

• Fleet Fuel Efficiency: measured in km per liter or liters per 100 km. Closely linked to route optimization.

• WWR – Warehouse Waste Recycling Rate: percentage of total warehouse waste diverted from landfill through recycling or reuse. It measures commitment to the circular economy.
  Formula: (weight of recycled waste / total waste weight) x 100.

• PUR – Packaging Utilization Rate: this KPI measures the efficiency of packaging material usage by comparing the volume of goods with the volume of packaging used (helping reduce waste and costs).
  Formula: (goods volume / packaging volume used) x 100.

Logistics KPIs for data-driven decisions: real examples

Monitoring key logistics performance indicators allows decision-makers across many organizations to transform subjective perceptions into decisions driven by concrete and objective data. »In a structured warehouse logistics environment,« Enzo explains, »the analysis of operational KPIs is crucial for monitoring picker performance for example, by measuring the number of order lines picked per day and the interruptions that occur during picking list execution«. This makes it possible to understand whether the number of warehouse operators is aligned with actual needs, while the analysis of interruptions (often caused by stockouts or urgent requests) highlights areas for improvement, with the goal of progressively reducing them until they are eliminated. Enzo then described a couple of real customer cases where KPI analysis led to performance improvements and warehouse optimization.

Alpla: KPIs in the packaging industry

At Alpla, an international plastic packaging manufacturer, measuring the execution times of transport missions (analyzed by mission type) proved to be crucial. This KPI alowed to identify recurring bottlenecks and intervene on warehouse layout, redesigning flows to make routes smoother and more efficient.

Quadrifoglio Group: KPIs in the furniture industry

In the case of Quadrifoglio Group, a company specializing in office furniture, the structured tracking of operator downtime provided a clear view of inactivity causes. When an operator is not marked as »active« in the silwa platform (the WMS software by Stesi) they are required to indicate the reason for downtime. This helps:

• the customer understand why an operator is forced to stop and perform other tasks;

• calculate the actual daily capacity per warehouse operator;

• identify solutions to reduce downtime.

Measuring to decide: the strategic role of KPIs in logistics

As we have seen with the support of our CEO & HR, Enzo Cancian, KPIs are increasingly becoming foundational pillars of modern organizations. However, since KPIs must be adapted to the company context and calibrated according to specific objectives and unique organizational needs, it is not possible to define a priori which indicators are more important than others.

Defining upfront which goals you want to achieve and which indicators are needed to measure them is the basis of any project management and continuous improvement initiative. Each critical threshold, target, or service level must be defined coherently with the company’s specific context: a manufacturing SME, a 3PL, or a large industrial group will have very different priorities, constraints, and decision levers. Another important aspect to consider is that different performance indicators may serve different corporate roles, even when all are related to logistics and the supply chain.

»One interesting thing to note,« as our CEO Enzo Cancian points out, »is that among the logistics performance indicators we mentioned, some are also of great interest to CFOs, CEOs, and General Managers«. On one hand, they support decisions about future investments (for example, through equipment and vehicle utilization rates); on the other hand, they help identify and reduce hidden costs (such as inefficient warehouse space utilization). »Not to mention sustainability KPIs, which (when converted into action) enable regulatory compliance«. In short, proper logistics data analysis (when translated into action) impacts multiple decision-making areas, including:

• logistics costs that erode margins;
• overall profitability;
• environmental sustainability;
• business competitiveness;
• reduction of contractual risk and penalties.

»From the perspective of those who manage the supply chain on a daily basis, such as Supply Chain Managers and Logistics Managers, the topic becomes even more operational« Enzo continues. For these roles, collecting and analyzing logistics KPIs helps address some very common challenges, including:

• lack of end-to-end visibility across flows;
• difficulty monitoring SLA compliance;
• difficulty demonstrating the value of logistics or IT investments to the Board of Directors.

In summary, KPI measurement and analysis enable companies to identify improvement areas, optimize operations, and ultimately increase customer satisfaction. Data is the key to understanding the health of a warehouse, and given the complexity of modern supply chains, the ideal solution is a WMS. A Warehouse Management System centralizes data, standardizes processes, ensures traceability, and makes performance measurable, avoiding fragmented analyses or decisions based on incomplete information.

If you need support in planning, defining, or monitoring logistics KPIs, or if you would like to explore how Stesi software solutions can help you turn data into operational decisions, contact us. Our goal is to support companies on a continuous improvement journey and transform supply chain complexity into a competitive advantage.

FAQ: common questions about logistics KPI

Which apps help track warehouse, inventory, and transportation KPIs?

To effectively track warehouse and transportation KPIs, specialized software solutions are required, such as WMS (Warehouse Management Systems) and TMS (Transportation Management Systems), designed to automatically collect operational data and update it in real time. These systems enable monitoring of productivity, errors, cycle times, on-time delivery, and logistics costs.

What are the 3 most important KPIs to start monitoring a warehouse?

The three fundamental KPIs to start monitoring a warehouse are: inventory accuracy, picking accuracy, and successful delivery rate for shipments.

How can SLA compliance and supplier performance be monitored from the warehouse?

Monitoring SLAs and supplier performance starts with traceability of receiving and shipping activities. With a WMS integrated with transportation systems and ERP, it is possible to automatically measure indicators such as on-time delivery, order compliance, unloading times, and material quality. This allows companies to evaluate suppliers and intervene quickly in case of deviations from contractual agreements.

How can you tell if a warehouse is losing money for the company?

A warehouse can generate hidden costs that are difficult to detect without proper KPI monitoring. Indicators such as low inventory turnover, inefficient space utilization, picking errors, and high operational lead times help identify economic inefficiencies. Measuring these KPIs makes it possible to understand where margins are being eroded and to transform the warehouse from a cost center into a competitive advantage.