Project: Key Performance Indicators for the Food Supply Chain

Reference: BG 78

Last update: 05/02/2009 16:56:46

Objectives

The objectives of the research are to: (i) compare the relative perfomances of companies in the food distribution industry using exisiting KPI's (ii) collect the data necessary to calculate these indicators with a degree of statistical robustness, and (iv) provide the industry with information about its performance that it can use to use to improve the efficiency of its logistics.

This data should: (a) inform policy makers as to the effectiveness of the logistics system in this market sector, (b) allow inter-company comparison using data collected by common methods, and (c) enable contributors to quantify the impact of any interim operational changes made on their relative rankings.

Description

Since 1998 the EEBPP has been working on developing and establishing KPIs of vehicle utilisation in individual distribution sectors.

A previous study 'Benchmarking Vehicle Utilisation and Energy Consumption, Measurement of Key Performance Indicators' has been published as an Energy Consumption Guide (No. 76).

The current project is designed to follow up this previous work, using the KPIs proposed in the above report to compare the performances of several food distribution operations.

Contractor(s)

AEA Technology Environment
Harwell Business Centre, Didcot, Oxfordshire, OX11 0QJ
+44 (0)1235 432201

Cold Storage and Distribution Federation
Downmill Road, Bracknell, RG12 1GH

Heriot-Watt University
Logistics Research Centre, School of Management, Edinburgh, EH14 4AS
+44 (0)131 451 3850

Contract details

Cost to the Department: £88,026.00

Actual start date: 01 October 2001

Actual completion date: 01 April 2003

Publication(s)

Benchmarking Guide 78
Author: Heriot-Watt University
Publication date: 01/04/2003
£0.00
Source: TransportEnergy Best Practice
More information: http://www.transportenergy.org.uk/downloads/BG78.pdf

Analysis of Transport Efficiency in the UK Food Supply Chain
Author: Heriot-Watt University
Publication date: 01/04/2003
£0.00
Source: TransportEnergy Best Practice
More information: http://www.transportenergy.org.uk/downloads/KPI.pdf

Summary of results

  1. This second large synchronised audit of vehicle utilisation in the food supply chain has revealed wide variations in vehicle utilisation, delivery reliability and energy efficiency. Some of this variation is due to differences in the nature of the product and pattern of delivery. More detailed analysis of the data at sub-sectoral and intra-company levels suggests, however, that some of the variation is the result of differences in operating efficiency. The purpose of the benchmarking exercise is to expose these differences and give managers an incentive to raise operating performance to that of the most efficient fleets in their particular sub-sector. This will not only cut distribution costs; by reducing vehicle kilometres and energy consumption it will also yield wider environmental benefits.
    Analysis of the available KPI data suggests that there are several ways in which efficiency can be improved:

    While the average deck area utilisation of 69% is relatively high for the mix delivery operations surveyed, some companies fall well short of this figure and could do more to consolidate loads.

    The average level of empty running is low by comparison with other sectors, though again some companies perform poorly against this KPI and could probably put more effort into finding backloads.

    There could be greater consolidation of 'returns' in fewer trips to release vehicles to collect orders from suppliers.

    By spreading deliveries more evenly over the daily cycle and reducing the proportion of vehicle-kms run during the morning peak (particularly in primary distribution), companies could reduce transport costs, vehicle emissions and transit time variability.

    Greater adherence to schedules at collection and delivery points would improve the utilisation of vehicle assets and establish a more stable environment for route planning and back loading.

    The widespread practice of pre-loading refrigerated vehicles well ahead of the departure time needs to be reassessed in the light of current concerns about fuel efficiency and emissions.
    Energy-intensity should be more widely adopted as a distribution KPI as it makes companies more aware of the combined effect of fuel efficiency and vehicle loading on energy consumption.