Food & Beverage KPIs

KPI Performance Key

Your business may just be beginning to track this metric, perform this business function or identified this as a problem. Improved execution in this area should be a high priority.

Your business is competitive in this area, but there’s still room for advancement. Consider investments to improve related operations to achieve better results.

Your performance in this area is considered best in class and is superior to the average company in your sector. You’ve laid a solid foundation in this business function, and the next step is optimization.

You’re achieving the optimal results for this metric. Your business processes in this area are highly efficient and stand out against competitors. Keep investing in this area to maintain these results.

Top Performers

Distribution Cost as a % of Revenue

Distribution costs represent one the largest areas of expenditure for a food and beverage company. It’s imperative when working with perishable items that the shipment method has the correct environment and timeliness to get items on the shelf at their peak freshness. Some companies lower distribution costs by consolidating shipments, using integrated sales and fulfillment data, cross-docking and implementing 3PL.

> 4%
Foundational
4%
Competitive
3.5%
Best in class
< 3%
Transformative

Explosive Growth Rate

Craft Breweries

6,266

Craft Breweries

Read more about craft beer’s explosive growth here.

Source: Brewers Association

Left Quote
Improvements in sensor technology, robotics and [AI] have the potential to significantly improve food safety.”
—Kate Brown

Learn more here.

Inventory Turnover

For food and beverage manufacturers and distributors, getting inventory turnover just right is imperative to profitability. The manufacturing of perishable items requires a more frequent turnover with the goal of producing the least amount of waste. Another important component to consider when defining inventory turnover goals is the gross margin on the sale of your products. Lower margins require higher stock turnover to meet revenue targets. Typically buying less product more frequently in the food and beverage space allows for better inventory turnover metrics and less waste.

< 3 turns
Foundational
6 turns
Competitive
10 turns
Best in class
> 18 turns
Transformative

Fill Rate

Fill rate represents the percentage of your orders that are shipped in full and on time as a percentage of all your orders. This metric is essential to providing exceptional service to your retailers and maintaining positive customer satisfaction. You should always aim to have a 100% fill rate, however this can be a difficult balance in the food and beverage industry. Purchasing too much inventory ensures that you maintain a high fill rate, but leads to costly inventory loss, while too little inventory on hand leads to poor fill rates.

< 94%
Foundational
95%
Competitive
96.2%
Best in class
> 97.8%
Transformative
Foundational
Competitive
Best in class
Transformative

eCommerce
Growth

< 10%

15%

20%

> 30%

eCommerce Growth

This metric indicates the rate at which your company’s e-commerce revenue is growing.

Revenue
Growth

< 0%

5.5%

9.7%

13.8%

Revenue Growth

This metric indicates the rate at which your company’s total revenue is growing.

Days Sales
Outstanding

65.4 days

42.6 days

32.6 days

22.6 days

Days Sales Outstanding

How many days, on average, it takes your customers to pay invoices. Also called DSO or Days Receivable, it is a financial ratio that illustrates how your receivables are being managed. The lower this number is, the better.

Inventory
Turnover

< 3 turns

6 turns

10 turns

> 18 turns

Inventory Turnover

Ratio showing how many times your company’s inventory is sold and replaced over a period of time. The days in the period can then be divided by the inventory turnover formula to calculate the days it takes to sell the inventory on hand. A low turnover ratio signifies weak sales and excess inventory. A high ratio suggests either strong sales or large discounts.

Fill Rate

< 94%

95%

96.2%

97.8%

Fill Rate

Percentage of customer or consumption orders satisfied from stock at hand. It’s a measure of an inventory’s ability to meet demand. A higher fill rate indicates a better ability to meet sales requests, influencing higher customer satisfaction.

Distribution
Cost as a %
of Revenue

> 4%

4%

3.5%

< 3%

Distribution Cost as a % of Revenue

Dollar amount spent on distribution costs as a percentage of total revenue. The lower this number, the more efficient the distribution process.

Customer
Service
Responsiveness

> 1 day

> 8 hours

< 6 hours

Real-time

Customer Service Responsiveness

This metric indicates the average time it takes to respond to customer issues. A lower response time drives more efficiency, freeing labor time for more valuable tasks or reducing the need to hire additional staff.

Time to Close
the Books

> 10 days

5 days

2 days

Hours

Time to Close the Books

How many days it takes your finance team to produce a Profit and Loss Statement, Balance Sheet and other analyses so that managers can understand how the business performed for that period (typically monthly). The fewer days, the more efficient the finance team.

Total IT Cost as
a % of Revenue

> 1.8%

1.8%

1.3%

0.8%

Total IT Cost as % of Revenue

Dollars spent on IT infrastructure and IT teams as compared to total revenue. The lower this percentage, the higher the efficiency.

Source(s): Finlistics

Other Categories
This metric indicates how fast your company’s revenue is growing in the eCommerce space. The higher this percentage is, the faster your eCommerce growth.
This metric indicates how fast your company is growing, measured by total revenue. The higher this percentage is, the faster your revenue growth.
How many days, on average, it takes your customers to pay invoices. Also called DSO or Days Receivable, it is a financial ratio that illustrates how your accounts receivable are being managed. The lower this number is, the better.
Ratio showing how many times your company’s inventory is sold and replaced over a period of time. The days in the period can then be divided by the inventory turnover formula to calculate the days it takes to sell the inventory on hand. A low turnover ratio signifies weak sales and excess inventory, while a high ratio suggests either strong sales or large discounts.
Percentage of customer or consumption orders satisfied from stock at hand. It’s a measure of an inventory’s ability to meet demand. A higher fill rate indicates a better ability to meet sales requests, therefore maintaining higher customer satisfaction.
Dollar amount spent on distribution costs versus total revenue. The lower this number is, the more efficient the distribution process is.
This metric indicates the average time it takes to respond to customer issues. A lower response time drives more efficiency, freeing labor time for more valuable tasks or reducing the need to hire additional staff.
How many days it takes your finance team to produce a Profit and Loss Statement, Balance Sheet and other analyses so that managers can understand how the business performed for that period (typically monthly). The fewer days this number is indicates a more efficient finance team team.
Dollar amount spent on IT infrastructure and IT teams as compared to total revenue. The lower this percentage is indicates higher efficiency
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