No matter what type of business you operate, Key Performance Indicators (KPIs) are crucial metrics. It is this set of data that helps you better monitor all sorts of tasks and programs. Most importantly, KPIs pinpoint areas of your operation that need your attention.
One of the most important points of focus for shippers is the last-mile.
While there are several strategies that can help logistics companies analyze programs, last-mile services are generally harder to measure through more traditional standards. As such, it’s important for shippers to set up a series of last-mile KPIs to monitor.
To get you started, below are four KPIs to monitor that will help you improve your last-mile or white glove services.
The On-Time Delivery Rate
There are several aspects to last-mile services that improve customer service – and fulfill their needs.
However, one of the most important is ensuring that they receive their packages as promised. If a customer is promised their package by Thursday or paid for a specific delivery commitment, they need to receive exactly what they have paid for. When the package is not delivered as committed, they obviously get frustrated and are less likely to do business with the shipper in the future.
Smart shippers utilize advanced tracking technologies to stay on top of deliveries. If a delivery is going to be late, the simple act of communicating this information to a customer can reduce complaints and loss of business quite significantly.
While customer service is crucial, it’s important to stay within your budget to maintain profitability.
The best way to do this is by creating overall cost per delivery KPIs to monitor. Since each company is unique, you’ll have to figure out a cost per mile that is acceptable for your business.
You likewise need to determine if you are going to cover shipping for the customer, or if they can opt for enhanced delivery methods. If your customers will pay for better white-glove service, make sure to keep it affordable for them, and never, under any circumstance, be influenced to mark-up shipping costs for your customers.
Capacity Utilization or Hours in Motion
Last-mile logistics programs are not only operated by shippers.
In fact, more carriers and delivery companies are actively involved in white-glove service. If you’re a carrier, measuring the efficiency of your last-mile logistics services will require significant reporting, planning, and fine-tuning. Many carriers focus on efficiency when delivering products to end-users by factoring the capacity utilization and hours in motion.
Capacity utilization is an important KPI that allows you to review the capacity of each delivery.
Hours in motion determines how many hours drivers spend in motion versus the amount of time they are stationary. This helps show the performance of drivers. It also impacts the fuel—how much time is spent idling—as well as the ability to get goods delivered on time. This number is achieved by dividing the total amount of time drivers spend on the route versus the number of hours in motion.
How many customer complaints are you receiving? Are they centralized to one location, route, truck, or driver – and if so; why?
Complaints from customers tell you what your service looks like and where you have room for improvement. Monitoring this KPI will tell you a lot about how you can decrease the number of complaints or chargebacks you receive by analyzing patterns to determine what is causing it.
Damages count as a complete loss for both the shipper and the business for which they’re shipping. It’s necessary to reduce the number of damages to improve the bottom line and enhance customer service.