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The Back Order Rate KPI measures how many orders cannot be filled at the time a customer places them. A high back order rate means your customers are forced to wait while you attempt to fill their order, which will adversely affect customer satisfaction and retention in the long term. This supply chain KPI is closely related to the inventory accuracy KPI and percentage of out of stock items KPI. Monitor this KPI to identify why certain items are not in stock and to deal with trends (such as seasonal demand) that may affect your performance.
Monitoring Supply Chain KPIs on a Dashboard
Once you have established benchmarks and targets for Back Order Rate, you’ll want to establish processes for monitoring this and other supply chain KPIs. Dashboards can be critical in this regard. Read more