Logistics and transport managers rely on key performance indicators (KPIs) to measure and improve operational efficiency. Focusing on the right transportation performance metrics – from on-time delivery to freight cost per shipment – is crucial for a well-run logistics department. By tracking these KPIs, you can identify bottlenecks, reduce costs, and enhance service levels in a multi-carrier network. This is especially important for mid-size and large shippers who work with many carriers, have too many daily shipments to handle manually, and have an ERP system to sync it all with.
In this article, we outline the most important logistics KPIs for transportation and shipping, providing definitions, formulas, benchmarks, and actionable insights for each. You’ll also see why each KPI matters – from managing carrier performance to meeting sustainability goals – and how a modern Transportation Management System (TMS) like Cargoson can help track or improve these metrics. (Tip: At the end, we suggest a handy KPI checklist or Excel dashboard you can use to monitor these metrics.)
1. On-Time Delivery Rate (OTD)
One of the most critical shipping KPIs is On-Time Delivery Rate, the percentage of shipments delivered to the customer on or before the promised date. It’s calculated as:
On-Time Delivery Rate = (Number of shipments delivered on time / Total number of shipments) × 100%.
This metric directly reflects service reliability and customer satisfaction. An OTD rate approaching 100% means your carriers and processes consistently meet delivery commitments. According to industry benchmarks, an on-time delivery rate of 95% or higher is considered excellent (KPIs for Enhanced Logistics Efficiency – StartupModelHub.com). World-class operations often target even higher, knowing that many big retailers expect ~95%–98% on-time performance from suppliers. High OTD is crucial for maintaining trust with customers and avoiding penalties or expediting costs.
A sample dashboard showing On-Time Delivery performance by month. In this example, on-time delivery hovers in the low 80s (%), indicating room for improvement in meeting delivery schedules. Tracking OTD trends helps identify systemic issues (e.g. delays with specific carriers or lanes) and drives corrective action.
Why it matters: Every late shipment can disrupt downstream production or retail sales, leading to dissatisfied customers. For B2B manufacturers and wholesalers, poor OTD can strain client relationships or result in fines. Tracking on-time delivery is especially important in a multi-carrier environment – it allows you to compare carriers and lanes. For instance, you might find Carrier A delivers on time 98% of the time while Carrier B only 90%, prompting a review of Carrier B’s performance.
Actionable insights: If your OTD is below target, analyze the root causes. Is a particular carrier, route, or warehouse consistently causing delays? Perhaps lead times promised to customers are unrealistic. Use your TMS to monitor transit times in real time and send automatic alerts for any shipment running late. Proactive measures like expediting at-risk shipments or switching to more reliable carriers for critical lanes can boost on-time performance. Also, integrating your TMS with your ERP helps ensure promised delivery dates are realistic and visible to all parties, aligning customer orders with transportation planning. Over time, improving on-time delivery will enhance your reputation and may allow you to negotiate better terms with customers and avoid fines and rush freight costs.
While on-time delivery measures reliability against promised dates, Average Transit Time tracks the actual speed of your shipments. This KPI measures the average time it takes from when an order ships to when it’s delivered. For example, you might calculate transit time in days or hours across all shipments or for specific routes. We recommend calculating an ATT for each route and carrier separately, since your routes might change over time and alter your overall ATT metric. An optimal average transit time depends on distance and mode: one industry guideline is around 48 hours for local deliveries and 5–7 days for long-distance shipments (for ground freight in Europe).
Why it matters: Transit time affects inventory levels and customer satisfaction. Shorter delivery cycles can reduce the need for customers to hold excess inventory and give your company a competitive edge in responsiveness. Even if you meet promised dates, consistently long transit times might indicate inefficiencies (e.g. indirect routing, delays in handoffs) or opportunities to use faster carriers or modes. For example, if your average transit from Germany to Spain is 6 days, exploring a different carrier or mode that can do it in 4 days could speed up your supply chain.
Actionable insights: Track average transit times by lane and carrier. Large deviations or increasing trends may signal issues like carrier capacity problems or customs clearance delays (for international shipments). A modern TMS can automatically log pickup and delivery timestamps, making it easy to compute transit times. With that data, you can set improvement targets—say, reducing average transit time on a key lane from 5 days to 4 days. Keep in mind, faster isn’t always better if cost skyrockets: try to find the right balance. By integrating transit time data with your ERP’s order management, you ensure that any changes in transit performance are reflected in lead times promised to customers.
On-Time In-Full (OTIF) is a broader supply chain KPI that combines timeliness and completeness of delivery. A shipment is “on-time, in-full” if it arrives by the promised date and contains the correct product and quantity ordered (no shortages or mistakes). The OTIF formula is:
OTIF = (Number of orders delivered on time with full quantity / Total orders) × 100%.
This metric is especially critical for companies supplying large retailers or manufacturing lines, where both timing and completeness are enforced. An OTIF of 95% or above is often a common goal in industries like consumer goods (some retailers require suppliers to maintain high OTIF or face penalties).
Why it matters: OTIF provides a customer’s-eye view of your delivery performance. It bridges warehousing and transportation – a failure could be due to a warehouse short-shipping an item or a carrier delivering late. In multi-carrier operations, you might deliver on time but short (or vice versa); only OTIF captures the full success rate. High OTIF means your logistics is synchronized end-to-end: inventory is available, picked correctly, and shipped with reliable carriers. For the customer, OTIF is a key service indicator – a 98% OTIF means 98% of the time they got exactly what they wanted, when they wanted it. Low OTIF, by contrast, can disrupt production schedules (if components arrive late/incomplete) or lead to lost sales in retail. Large B2B customers will likely impose fines on you, and it can also trigger extra admin work (e.g. expediting backorders or issuing credits).
Actionable insights: Improve OTIF by addressing both its components. If the “in-full” part is lacking, focus on order accuracy and inventory planning – ensure your ERP/WMS has accurate stock data and your warehouse picking process is error-free. If the “on-time” part is the issue, work with carriers or adjust lead times as discussed in the OTD section. Many companies form cross-functional teams (planning, warehouse, transport) to review OTIF failures weekly and implement fixes (like adjusting safety stock or using backup carriers for urgent orders). Using a TMS integrated with your enterprise resource planning system (ERP) can help here: the TMS will help you flag when an order is shipped incomplete or late, so you have immediate visibility into an OTIF miss and can take action (like sending a partial shipment or informing the customer proactively). Over time, tracking OTIF alongside OTD gives a comprehensive view of delivery performance that pure on-time metrics might miss.
Controlling transportation costs is a top priority for logistics managers, making Freight Cost per Shipment a vital KPI. This metric tells you the average cost incurred to ship a single order or load. It’s typically calculated as:
Freight Cost per Shipment = Total freight spend in a period (€) / Total number of shipments in that period.
For example, if you spent €500,000 on transportation last quarter for 1,000 shipments, your average cost per shipment is €500. You can further refine this by shipment type or mode (cost per pallet, cost per ton, cost per parcel, etc.), but at a high level it indicates cost efficiency. Many companies also monitor freight cost per unit weight or volume (e.g. cost per ton shipped) and transportation cost as a percentage of sales. In fact, a common target is keeping total freight costs below 10–15% of overall revenues, though this can vary by industry and distance – lower is better for profitability. If your products are high-value, you have more leeway to use more expensive (= faster, less errors) carriers and services, and the other way around too.
Sample KPI dashboard section in Cargoson: Freight cost in a period, savings from rate shopping and total CO2 emissions
Why it matters: Transportation often represents a significant portion of logistics costs, sometimes 5–10% of a manufacturing company’s sales. If freight cost per shipment is too high or rising, it can erode margins or indicate inefficiencies (like under-utilized trucks or expensive carriers). By tracking this KPI, you can spot trends such as fuel surcharges driving costs up, or savings from new carrier contracts driving costs down. It’s also useful for pricing: knowing the average shipping cost per order helps in setting minimum order quantities or freight-inclusive pricing. For instance, if an average shipment costs €400 and your average order value is €1000, transportation is 40% of sales – possibly way too high. Freight cost KPIs can thus inform decisions like adjusting free shipping thresholds or selecting different service levels.
Actionable insights: Break down freight cost per shipment by carrier, mode, customer, or region to identify where costs are highest. You might find one carrier is consistently more expensive for similar shipments, prompting rate negotiations or mode shifts (air to sea or road, LTL to FTL etc). A multi-carrier management strategy is key here: using a TMS, you can automatically compare carriers for each shipment and choose the most cost-effective option that meets service requirements (aka rate shopping). Over time this keeps your average cost per shipment low. Also, integrate your TMS with your ERP or finance system so that actual freight costs (from carrier invoices) are captured and can be analyzed against budgets and sales. Automation can help a lot – for example, Cargoson’s freight rate management module can consolidate all your carriers’ expected invoices and compare them with the actual received invoices. Finally, monitor accessorial charges (extra fees) as part of this KPI. If your cost per shipment is high due to many surcharges (tail lift fees, waiting time, etc.), that points to process improvements (better shipment planning, load consolidation, etc.). By continuously improving this KPI, you directly contribute to the company’s bottom line and overall supply chain efficiency.
5. Transportation Capacity Utilization (Load Factor) – if you ship FTLs
Efficiency is also about how well you use the capacity you’re paying for. Transportation Capacity Utilization (sometimes called load factor or trailer utilization) measures how much of a truck’s or container’s capacity is being used by your shipments. In formula terms:
Capacity Utilization = (Total weight or volume of cargo on a load / Total capacity of the vehicle) × 100%.
For instance, if you ship 20 tons (in payable weight, or volumetric weight) in a truck that can carry 25 tons, that truck’s utilization is 80%. This KPI can be averaged across all shipments. A higher percentage means you’re shipping “fuller” loads. As a general benchmark, a utilization rate of 75% or higher is viewed as efficient (KPIs for Enhanced Logistics Efficiency – StartupModelHub.com), and many aim for above 80% on average (KPIs for Enhanced Logistics Efficiency – StartupModelHub.com) to maximize efficiency. Low utilization means shipping air – you’re paying for space you’re not using.
Why it matters: Poor load utilization drives up the freight cost per unit and per shipment. If you consistently paying for full truckloads (FTL) while sending trucks that are only half-full, you might be able to consolidate shipments or use smaller vehicles to save money. Utilization also impacts sustainability – shipping two half-empty trucks produces more CO2 than one full truck. For companies in Europe facing high fuel costs and carbon emission pressures, improving load factor is a win-win (cost and environmental benefit). Additionally, if you manage your own fleet, utilization is directly tied to asset productivity and ROI. Even when using third-party carriers, many contracts (especially full-truckload rates) assume you utilize the space – under-loading a truck is essentially a lost opportunity.
Actionable insights: Track capacity utilization by mode and lane. If certain routes consistently show low utilization (e.g. trucks returning empty or half-full), consider strategies like backhauling (finding a return load), load consolidation (combining multiple orders into one shipment), or switching to a different mode (maybe less-than-truckload (LTL) shipments if you can’t fill a full truck - FTL). A TMS can assist by suggesting consolidation opportunities – for example, two orders going to the same region on the same day could be combined to fill a truck, instead of sending two partially filled trucks. You should also collaborate with your warehouse and planning teams: maybe orders can be scheduled or held a day to ship together and boost utilization. Monitor this KPI alongside freight cost per shipment and CO2 per shipment, since improvements in utilization will positively impact both. Over time, setting a target (say increase average load factor from 70% to 85%) and tracking it religiously can yield significant cost savings and emission reductions.
Delivery is not truly successful if the goods don’t arrive in good condition. The Claim Rate for Damaged or Lost Goods is a quality-focused KPI measuring what percentage of shipments result in a freight claim due to damage, loss, or other issues in transit. It’s calculated as:
Claim Rate = (Number of shipments with a damage or loss claim / Total number of shipments) × 100%.
For example, if out of 1,000 shipments you had 8 with damage claims, your claim rate is 0.8%. Ideally this number should be as low as possible; keeping the damage claim rate below 1% is essential for maintaining trust and reliability. Leading companies even strive for 0.1% or less in some industries (meaning 1 in 1000 shipments has an issue).
Why it matters: A high damage rate hurts customer satisfaction, leads to extra costs (replacing goods, fines from customers, expedited reshipments, insurance claims), and may indicate problems in packaging or carrier handling. For B2B shipments, damage could halt a production line if critical components arrive broken. It also strains carrier relationships – frequent claims might trigger carriers to review how freight is packaged or even refuse certain loads if they suspect issues. Low claim rates, on the other hand, imply robust packaging, careful handling, and good carrier performance. They protect your company’s reputation for reliability. In sectors like chemicals or electronics, damage could also pose safety hazards, so it’s even more critical to minimize.
Actionable insights: Track which products, lanes, or carriers have higher claim incidents. You might find, for example, that LTL (less-than-truckload) shipments have more damages than full truckload, due to more handling touches at terminals. If so, consider using more direct shipping methods for fragile products. Or perhaps one carrier has a disproportionately high loss/damage record – that may warrant an audit or switching carriers for sensitive loads. Packaging improvements are often a quick win: investing in better pallets, padding, or weather-resistant wrapping can pay off in lower claims. A TMS can help by centralizing all incident reports; whenever a delivery issue is reported, you log it in the system with the carrier, cause, and cost. This creates a database to analyze trends (e.g., “50% of our damages are water damage on sea freight – maybe we need more container liners”). Automation can assist in claim filing too – modern TMS platforms let you record a claim and even communicate with the carrier’s claims department. By actively managing and reviewing the claim rate KPI, you not only cut unnecessary costs but also feed those insights back into continuous improvement (safer packaging, better carrier selection, improved handling processes). The goal is to inch closer to zero-defect deliveries.
Handling freight invoices might not be glamorous, but Invoice Accuracy is a KPI that can’t be overlooked in transportation management. This metric measures what percentage of freight invoices from carriers match the originally quoted or calculated cost without requiring disputes or adjustments. It can be expressed as:
Invoice Accuracy = (Number of error-free freight invoices / Total freight invoices) × 100%.
If you receive 500 invoices a month and 475 had no issues, your accuracy rate is 95%. Companies often set a high target for this – ideally 98-100%, but certainly no less than about 95% accuracy (Transportation Provider KPIs: How to Evaluate The Performance of Your Network). Anything below that means a lot of billing errors are slipping through.
Why it matters: Inaccurate freight bills cause multiple problems. They create extra administrative work (your team has to identify the error, file a dispute or request a credit, and monitor that). They can lead to overpaying if not caught – for instance, being billed a higher rate than agreed or erroneous fees. Over time, small overcharges add up and chip away at your freight budget. Frequent invoice issues might also indicate underlying issues: maybe your shipment data sent to the carrier was incorrect (causing billing discrepancies), or the carrier’s billing system is out of sync with contracted rates. In a multi-carrier environment, invoice accuracy helps you identify if one carrier is particularly error-prone. Different carriers have very different rate sheets, surcharges and calculation logics which Cargoson’s powerful freight rate calculation engine is capable of handling (Aivo Kurik: The European Road Transport Price List Is Like a Restaurant Menu With 10,000+ Dishes). Things often get complicated and we’ve even caught ourselves explaining to different carriers how their own price calculation logic works ☺️
Moreover, when transportation costs are integrated into your ERP for financial reporting, errors can misstate your logistics costs on the books until corrected. Essentially, low invoice accuracy is a sign of process gaps either on the carrier side or your side, and it detracts from the “automation” we strive for in modern logistics. A highly automated, integrated process (think EDI or API billing) should yield very high accuracy.
Actionable insights: First, measure it – many shippers don’t track invoice accuracy formally, and it becomes apparent only when problems become big. Use your TMS or audit software to log discrepancies. For each carrier, track how many invoices had to be corrected. If below 95% accuracy for a carrier, it’s a red flag (Transportation Provider KPIs: How to Evaluate The Performance of Your Network) – time to engage with them. Often, simply sharing an audit report with the carrier can prompt improvement; they might fix a fuel surcharge formula or retrain staff on accessorial charges. Internally, ensure your team transmits correct shipment info (weights, accessorial requests, etc.) to carriers to prevent errors. Consider automating freight audit: many TMS platforms, including Cargoson, can automate freight price calculations – the system calculates the freight cost and surcharges from your agreed rate sheets, carrier APIs and spot quotes, and checks the invoice against the calculated rate, and flags any discrepancy. Over time, your goal should be to minimize billing surprises. When invoice accuracy is high, you can trust your cost KPIs (like cost per shipment) much more and your finance department will thank you for the clean, predictable freight expenses. In sum, invoice accuracy might not improve physical flow, but it strongly affects cost control and administrative efficiency – key aspects of transportation operations.
Sustainability has become a key performance area for transportation in Europe. CO₂ emissions per ton-km is a KPI tracking the average carbon footprint of each shipment, typically measured in kilograms of CO₂. You can calculate it as:
CO₂ per ton-km = Total CO₂ emissions from transport in a period / (Tonnage of shipments in that period * Total transported kilometers of all shipments in that period).
CO₂ for a single shipment can be estimated based on distance, mode, and weight (for example, using standard emission factors: a truck shipment emitting X kg CO₂ per ton-km, etc.). It effectively captures how “green” your transportation is. As companies strive to reduce their carbon footprint, they expect this number to go down over time. For instance, if last year you emitted an average of 50 kg CO₂ per shipment, maybe this year you target 45 kg by optimizing routes and loads. Logistics (transport) can comprise well over 50% of the pollution for a company’s operations, making it essential to limit CO₂ emissions per shipment.
Why it matters: Aside from corporate social responsibility, there are growing regulatory and market pressures in Europe to cut transport emissions. The EU’s climate targets and initiatives like the Green Deal mean companies must monitor and report their Scope 3 emissions (which include third-party transport). Customers and investors increasingly demand transparency on carbon footprint. By tracking CO₂ per shipment, you can demonstrate improvements – e.g., “We reduced CO₂ per shipment by 10% this year through better consolidation and using greener carriers.” It’s also closely tied to cost efficiency: typically, the steps that reduce emissions (fuller trucks, optimized routes, intermodal transport) also reduce cost. Moreover, some shippers are starting to incorporate CO₂ performance into carrier scorecards – rewarding carriers who invest in eco-friendly fleets (Euro 6 trucks, electric vehicles, etc.) or who have better emission records. In the context of multi-carrier management, you might choose a carrier not just on rate but also on their CO₂ per shipment for a given lane. This KPI thus helps integrate sustainability into day-to-day decision making.
Actionable insights: Start by establishing a method to calculate emissions. Some TMS platforms like Cargoson estimate CO₂ for each shipment automatically, based on distance and mode. If not, you can use standard datasets (e.g., the Global Logistics Emissions Council (GLEC) framework) or tools like EcoTransIT to get estimates. Once you have the data, analyze it by mode: typically, air freight has a huge CO₂ per shipment, sea freight is lower per ton (but used for big shipments), and road is somewhere in between. Note that to actually make an impact, you should be calculating the emissions when you are making transport decisions, not after! Cargoson can help you with that.
Also, look at outliers – which shipments have the highest emissions? Perhaps you’re shipping small loads via dedicated trucks (bad utilization) or using air freight for certain customers; those are prime targets to optimize. Set reduction goals annually, and report progress. For example, you might commit to cutting emissions per shipment by 5% each year through measures such as route optimization, switching some volume from air to sea, or road to rail, or using carriers with alternative-fuel vehicles. A concrete step could be to consolidate two weekly deliveries into one for certain customers – doubling the load size halves the emissions per delivery in theory (Sustainability Development Goals - Rhenus) (a logistics provider noted combining shipments can reduce CO₂ per shipment by 10–40% in some cases). Encourage carriers to provide actual fuel consumption or emissions data; some large carriers have telematics that can give you more precise footprint data. By tracking CO₂ per shipment alongside traditional KPIs, you ensure that cost and speed improvements aren’t coming at the expense of the environment. In fact, you’ll likely find synergies where greener = leaner. Finally, highlighting this KPI internally and externally shows your commitment to sustainable logistics, which can be a differentiator in the market and keep you ahead of regulatory compliance.
You can’t manage what you don’t measure. Start tracking your logistics KPIs today!
Tracking these transportation and shipping KPIs gives logistics managers a 360° view of performance – from cost efficiency and speed to service quality, carrier reliability, and sustainability. The real power of KPIs lies in how you use them. It’s important to review them regularly (e.g. monthly scorecards and quarterly business reviews) and to involve cross-functional teams in understanding the story behind the numbers. For instance, an uptick in freight cost per shipment or CO₂ per ton-km is an alarm bell to investigate and optimize routes, loads, freight modes (road, air, sea, rail) or carrier contracts. Likewise, a drop in on-time delivery rate should trigger service recovery plans and process checks from order entry to carrier dispatch.
Today, you can just delegate the KPI tracking to technology. A modern multi-carrier transport management software (TMS) like Cargoson can automatically capture data for all these metrics – aggregating multiple carriers’ information, integrating with your ERP for seamless data flow, and displaying real-time dashboards. Instead of logging into different carrier systems and trying to export the data or requesting shipment history spreadsheets from your account managers, crunching spreadsheets for hours trying to fit them all into one format, your team gets to focus on analysis and improvement. Many companies even integrate KPI alerts (for example, if on-time falls below 90% this week, or if a carrier’s tender rejection spikes, a notification is sent) so they can act before small issues become big problems.
Finally, consistency is key. Choose a set of KPIs that align with your strategic goals (cost reduction, customer satisfaction, sustainability, etc.) and stick with them. Over time, you’ll build a historical baseline and truly see the impact of initiatives like new carrier programs or automation projects. And don’t keep the insights to yourself – share KPI results with executives to justify investments, with customer service teams to inform them of any delivery issues, and even with customers if you’re collaborating on improvements.
To help you get started, if you’re not using a modern TMS like Cargoson, consider creating a transportation KPI dashboard or checklist for your operation. (For example, a simple Excel or BI dashboard that tracks the 5–10 metrics we discussed). This can serve as a playbook for your logistics team – everyone from the warehouse floor to the C-suite can see how shipping performance is trending. We’ve discussed a lot of numbers, but remember: each KPI is a tool to drive action. By focusing on these key logistics KPIs and continuously refining your processes with the help of data (and possibly a capable TMS), your company will be well-positioned to improve service, cut costs, and stay keep your supply chain competitive.
If you're a manufacturer, wholesaler or a retailer not yet using a TMS, book a consultation and let's discuss and see if and how Cargoson's TMS could help you:
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