Want to get a good freight rate in Germany? Get to know these indicators.
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Key Performance Indicators (KPIs) are among the most commonly used in German companies. They are used to objectively measure the efficiency of production processes, compare them over time and draw conclusions from them to optimise transport processes.
Below are some examples of Key Performance Indicators (KPIs) for the transport sector in Germany and for the supply chain in general, as its cost has a direct impact on the financial performance of companies and the price of products paid by the end consumer.
Freight cost per unit
This indicator is calculated by dividing the total freight cost by the number of units shipped in the period (month, week). It is used when the units shipped are standard (kg, litres, tons) or the products are always identical. It can also be calculated in detail by means of modal transport (trucks, trains, boats, planes, and even more precisely – FTL, LTL, intermodal, etc.).
Percentage of truck capacity used
Usually used for heavy loads, it is calculated by dividing the weight carried by the maximum permitted size (for trucks, boats, etc.). If the average consumption is 80%, it means that 20% is still unused, which can bring more profit and greater efficiency.
Outbound transport cost as a percentage of sales
Freight (delivery) costs are divided by sales revenues in a given period. Of course, this percentage varies considerably depending on the products sold, but it is a great indicator for checking the financial performance of the transport area.
Inbound freight cost as a percentage of purchases
Freight costs are divided by the cost of goods purchased in a given period. This indicator should not be compared to products purchased with different modes of transport: those whose load is known but paid for by the supplier and those paid for by the company itself.
Time in transit
It is measured as the number of days (or hours) from the time a batch of products leaves the factory/enterprise until it is delivered to the customer. It is usually compared with the transit time offered by a transport company for the same product, means of transport and destination. Travel times may vary considerably depending on the means of transport chosen.
Pick-up in time
It is calculated by dividing the number of pick-ups by the total number of loads shipped in a given period. This allows you to evaluate the performance of the carrier, which affects the performance of the shipper/manufacturer and customer satisfaction.
Claims as a percentage of transport costs
They are calculated by dividing the costs of losses and compensation claims by the total transport costs. This indicator is measured for each supplier and for the company. High numbers may indicate problems with packaging or storage.
Truck stopping time
This indicator is calculated by measuring the average time between the arrival of the truck and its departure. The shorter the time, the longer the truck is on the road delivering goods. If this time is long, it means that the loading and unloading process needs to be improved.
Percentage of identifiable cargo
This indicator is calculated by dividing the number of tracked loads by the total number of loads shipped in the period. This indicator measures the relative advancement of the carrier.
When negotiating the price of freight or General Terms & Conditions for a German transport order (AGB), it is important to remember the above indicators so as to choose the best option for you. This makes it easier to negotiate the best rate for freight or a bonus for a timely pickup.