Microsoft Dynamics NAV News & Tips
How Does Your Distribution Stack Up Against the Industry?

Have you ever wondered how your distribution measures up to others? Integrated Computer Systems Support recently received the Distribution 2008 Executive Summary, based on the 2007 Census of Distribution survey, conducted by Grant Thornton, The MPI Group, Industry Insights, and Material Handling Management. This short report summarizes statistical information on the health of the distribution industry and provides several operational benchmarks combining all sectors of distribution.

Listed below are a few of the average measures that can help you compare your company to the industry:

• Dock to Stock Time (receipt of goods to storage): 10.4 hours
• Order Cycle Time (order release to ship): 25.1 hours
• Customer Delivery Lead Time (receipt of order to deliver): 8 days
• Orders per Hour (orders picked or packed/ total warehouse hours): 21.4 hours
• Order Accuracy (error-free orders/total orders) 96.3%
• Order Fill Rate (orders filled complete/total orders): 92.7%
• On-time Delivery (orders delivered on time/total orders): 94%
• Perfect Order Rate (perfect deliveries/total deliveries): 93.2%
• Cost per Order (annual labor and overhead costs/total orders): $327.57
• Total Inventory Turn Rate (annual dollar volume shipments/average volume on-hand inventory): 11.2

65% of respondents had a continuous-improvement program in place, but only 36% of those were using lean material management techniques. However, these statistics were quite different when looked at by revenue category as smaller distributers lagged behind their larger counterparts by 20% or more.

The MPI Group highlighted the fact that the best distributors continue to look for ways to keep goods moving through their facilities at lightning pace, enabling them to capture more revenue.

We are only sharing averages here, but the report also reports on the median, 25th and 75th percentile of each category. You can obtain a copy of the report at The MPI Group site.

Microsoft Dynamics NAV can assist you in reporting these key metrics over any period of time, and can even provide comparisons between periods. It also offers extensive inventory and distribution functionality to assist you with inventory planning, replenishment and storage, and offers several advanced modules including Advanced Forecasting, Warehouse Management Systems including radio-frequency based receiving and put-away, picking and packing, and Mobile Solutions.

How does your business measure up? Are you looking for ways to boost your bottom line through improving your distribution? For assistance in determining these key indicators, recommendations on inventory consultants familiar with improvement programs, or for additional information on Dynamics NAV distribution modules, please contact Mike Packard, Integrated Computer Systems Support at 425-284-5436.

We also have many more very informative white papers on our website written by industry experts covering topics such as manufacturing, distribution, operations, CRM, and Not-for-Profit. These are all free for the asking on our whitepapers pages.

 

Microsoft Dynamics NAV offers extensive inventory and distribution functionality to assist you with inventory planning, replenishment and storage, and offers several advanced modules including Advanced Forecasting, Warehouse Management Systems including radio-frequency based receiving and put-away, picking and packing, and Mobile Solutions.