Cold Chain KPIs to Track
Our blogs have focused on the cold chain over the past month. We’ll be covering a few of the key KPIs your company can track to boost your cold chain success in this post. As in previous blogs in our
series on KPIs, we won’t recommend specific numbers to target since every organization’s
situation is different.
For cold chain success, track: excursions, route performance, and on-time, in-full percentage.
Once you are tracking these metrics, follow our recommended best practices to identify poor performance, underlying causes, and how to fix them.
Use Routeique to get visibility into your cold chain.
This blog is part of our series on KPIs, which also includes:
What is the Cold Chain?
The term “Cold chain'' refers to managing the temperature of perishable products like food, beverages, and pharmaceuticals to maintain quality and safety from manufacturing throughout the distribution chain to the final consumer.
Failing to keep specific products at the correct temperatures can compromise the quality of the product and lead to serious consumer issues. Ensuring a high-quality product is delivered to your customer leads to an elevated level of customer satisfaction, greater demand, and overall safeguarding of the health of your consumer.
3 Essential Cold Chain KPIs Our Team Suggests Tracking
Excursion Types and Number
An excursion or, “Temperature excursion,” occurs when a temperature-sensitive product has been outside of the required temperature range. Maintaining an accurate and detailed temperature history of your products is vital to ensure that your products are put into your consumers’ hands in the most perfect condition possible. Something as little as an eight-degree shift in temperature can reduce the shelf life of some produce by almost a week.
Understanding why excursions happen is vital to maintaining the validity of the cold chain. Some things important to analyze when dealing with excursions are packaging, logistics providers and having the right tech to tell you where things are going wrong.
Excursion Types by Route
The cold chain uses several transportation methods, trucks, trains, planes, and even by sea. The length and complexity of these routes can vary, and therefore some routes can have multiple handoffs and multiple places where an excursion could happen. Delays and breakdowns though generally unavoidable can be devastating to a product, even causing whole shipments to need to be destroyed.
With increased visibility into your supply chain, you can gather the data you need to choose what methods of transportation are the most cost-effective for you and what methods have the greatest loss percentage overall.
Potential Causes of Excursions
The primary cause of an excursion is usually a malfunction in shipping vehicles or packaging. Another way that an excursion can happen is if your products are held or delayed at any transfer point.
The best way to reduce excursions is to ensure you have the best technology that your company can afford, including transportation and packaging, if your company takes care of that portion of your supply chain.
Sometimes excursions are just going to happen. Things can go wrong, and companies can hedge only so much risk ahead of time. Having the right tools to track and report excursions can allow you to get ahead and reduce loss and potential legal issues from having your product arrive in incorrect condition.
2. Best/Least Performing Route/Carrier
Having the right carriers and routes are vital to ensuring that your products are delivered in time by people who value your items as much as you do.
Late deliveries and mismanaged inventories can be incredibly costly, so having optimized routes and the right carrier can save an incredible amount of costs.
This circles back to the vital nature of having visibility into your supply chain to find the best routes and what carrier is doing the best work for you.
Causes of Low Performing Routes/Carriers
A low-performing carrier is usually caused by the carrier itself not being a good fit for your company. This often will look like your carrier not being able to scale to the volume that you require. In rare instances, sometimes an underperforming carrier will be a carrier who doesn't make your business a priority. Identifying and understanding that early will save you time and money.
A major cause of low-performing routes is a lack of optimization. The cold chain can often be a game of inches, and a poorly-forming route can come down to a few hours or even a few miles. Ensuring your products are transported as optimally as possible is key to having a high-performing route.
How to Increase Route/Carrier Performance
Understanding your business needs is the first step in selecting a carrier that's going to be the best fit for your business. Coming to the table with a detailed plan on what you require from a carrier ensures that you don't make a selection that won't work in the long term.
The best way to optimize your routes is to have software do it for you. Software technologies exist that take the headache out of route optimization and plan your routes ahead of time to ensure your products arrive on time and your cold chain runs smoothly.
3. On-Time, In-Full Percentage
Last but not least, the most obvious of KPIs to manage in your cold chain is the on-time, in-full percentage often referred to as the acronym OTIF.
OTIF is essentially the number of perfect deliveries made within your cold chain and the higher the percentage, the better. To be more specific, it's the number of orders delivered on time, with the correct quantity of products, on the day that the customer scheduled it for. “On time” is an incredibly important term in the cold chain.
If produce or vaccines don’t make it to their destination on time, the possibility of wasted items increases.
What makes this a very powerful KPI to track is that it can give you insights into many different aspects of the cold chain. Namely, it can help you discover inefficiencies in your supplier and fulfillment reliability.
Causes of Low OTIF Percentage
Causes of low OITF percentages usually fall under the causes detailed in the previous sections. OITF is a very overarching KPI. It usually requires everything to go perfectly to increase that percentage, so anything from excursions to an unsuitable carrier can be the cause.
How to Boost Your OTIF
Much like the causes of a low OTIF percentage are the same causes mentioned in the other categories, the best way to boost it would be to follow the improvement suggestions above. Still, it's important to realize that these solutions are not one size fits all and implementing any or all of these are not guaranteed to improve your cold chain KPIs.
How Can Routeique Help?
Insight, Foresight, and Oversight
Gain unparalleled product safety, monitoring, and visibility into your cold chain with Routeique.
Having visibility into your supply chain is essential to maintaining product integrity. Routeique has designed their cloud-based logistics system around better managing your cold chain at every step, helping businesses track assets every step of the way to ensure product safety, and monitor your vehicle location, temperature and humidity.
Routeique cold chain solutions gain real-time insight into your freezers, coolers and trucks with instant excursion alerts. Routeique will also organize this data into integrated reports to easily review, analyze and submit as proof of safety compliance.
Many Routeique customers rely on our unique cold chain technologies, like the Vehicle Intelligence Hub and Smart Chain Sensor for vehicle and asset tracking, to gain the upper hand on their cold chain.
Using the right set of Routeique solutions will allow you to track the KPIs that are important to you, including the ones mentioned in this article, ensuring you can optimize your supply chain and cold chain from production to the customers' hands.