Improving Inventory Accuracy - APQC Research

What is the value of increasing inventory accuracy by one percent?  According to this APQC study, improving inventory accuracy is correlated with:

• higher percentages of supplier orders delivered on time,


• shorter dock‐to‐stock cycle times for supplier deliveries,


• higher percentages of sales orders delivered on time,


• lower total cost to operate outbound transportation per sales order, and


• lower freight costs to operate outbound transportation as a percentage of total logistics cost.

Examining inventory accuracy with other metrics in APQC’s Open Standards logistics research, APQC found that an increase in inventory accuracy from 98 percent to 99 percent is associated with:

• a 7.7 percent increase in supplier orders delivered on time,


• faster dock‐to‐stock cycle times (1.56 hours faster), and


• a 2.25 percent increase in the number of sales orders delivered on time).

This reminds me of a previous blog posting we prepared regarding the power of making changes in small 1% increments.  Read the post and download our spreadsheet.