You can’t manage what you don’t measure. It’s an old sentiment with modern-day meaning.
Last mile fleet management teams need vital data to make intelligent, impactful decisions regarding the moving components of their business, including driver safety, driver retention, and vehicle health. Enter Key Performance Indicators (KPIs).
The 1-2-3s of KPIs
KPIs can be as specific as you make them, and they measure where your business is succeeding and where it needs improvement. KPIs can apply to both over-the-road routing strategies and last mile delivery businesses, and they are particularly critical when analyzing the last-mile experience. Customer interactions and delivery stops are rampant in the last mile, paving the way for fleet management providers to decipher how their business is performing in numerous ways.
Innovation is fruitful when it benefits your daily transportation operations and long-term goals. Without KPIs in the last mile, you have no indication of how drivers are performing, how well you’re servicing customers, and which otherwise controllable inefficiencies are draining your bottom line.
Ask yourself:
Did we keep our promise to our:
- Drivers by providing them with distributed workloads and well-executed routing and delivery plans?
- Customers who are waiting for us to deliver undamaged items on time?
- Shareholders expecting efficiencies for maximum cost savings?
How expensive are my deliveries today?
- What does it cost to deliver to different types of customers?
- How much are my delivery profits?
- Is my vehicle being used as efficiently as possible?
The three main KPI categories
Productivity, customer satisfaction, and ROI are three key KPI categories.
KPIs take into account what you planned to happen and what actually happened every day, so you can understand how productive your business is now and where it has room for growth. For example, you could look within your driver's HOS data to see if you spent an hour longer at a specific stop than you anticipated, or if arriving at a particular dock at one time is better or worse for your driver’s day-to-day.
To satisfy customers, you can stand out by providing regular scorecards that highlight how effective and efficient you are, solidifying your brand, credibility, and authenticity in their minds. You can include stats around how many deliveries were on time. You can also find out how many off-day deliveries you made as a courtesy to them, as these are historically expensive.
ROI translates to revenue and cost in your business, enabling you to calculate your profit per mile. You can monitor which sectors generate the most revenue and ramp up your reach in those industries. Calculating cost is also imperative when aligned with revenue. If you’re spending what you’re making, you’re not saving.
Know your metrics to draw your growth trajectory
Last mile delivery is evolving at a rapid speed. Customers have heightened their expectations during the COVID-19 pandemic. Now, anyone with a vehicle can be a delivery driver or start a delivery business, and major retailers are even selling routes to shift their business models and optimize ROI.
As competition and customer fervor increase, there is unmatched pressure to deliver quickly, efficiently, and skillfully. You’re not only aiming to meet those expectations; you want to wow your customers and competitors.
Innovative fleet intelligence solutions incorporate KPIs so you can secure your business standing and optimize your goals. You can track and measure these goals and boost your offerings to make your presence known in this exceedingly competitive supply chain while delivering a last mile experience that wows today’s customers. Discover the last mile solutions you’ve been searching for.
For additional in-depth insight on KPIs, watch this webinar to learn how KPIs help measure last-mile delivery success.