A buyer is a key figure in a company that purchases goods. His work affects the level of stock, the quality of products and the financial results of the business.
Let's consider the key criteria for evaluating KPIs and their importance:
1. Accuracy of Demand Forecasting:
2. Inventory Turnover:
3. Inventory Level:
4. On-time delivery:
5. Procurement margin:
6. Quality of purchased products:
7. Optimization of procurement costs:
Properly selected KPIs help to effectively manage purchases and maintain high margins, which ultimately contributes to business growth and stability.
Learn more about how Smartup can improve the efficiency of your business. Contact us today!
- Why it’s important: Accurate demand forecasting allows a company to avoid surpluses and shortages, which reduces inventory costs and minimizes lost profits. Excess inventory can lead to write-offs, while understocking can lead to lost customers and sales.
- How to measure: Compare actual sales with forecasted values, analyze seasonal and market trends.
2. Inventory Turnover:
- Why it’s important: High inventory turnover means that items are sold quickly and replaced with new ones, which reduces inventory costs and reduces the risk of items becoming obsolete.
- How to measure: The number of times an average inventory is sold in a given period of time (e.g., a year).
3. Inventory Level:
- Why it’s important: Maintaining the optimal amount of inventory in stock helps avoid both surpluses and shortages. This balances inventory costs with meeting demand.
- How to measure: The number of days the current inventory lasts at the current sales level.
4. On-time delivery:
- Why it matters: On-time delivery of goods affects the smooth operation of the warehouse and customer satisfaction. Delays can lead to lost sales and customer loyalty.
- How to measure: The percentage of deliveries that arrive on time, according to schedule.
5. Procurement margin:
- Why it matters: A high procurement margin means that the company is making a significant profit from the sale of goods. It is a key indicator of the financial health of the business.
- How to measure: The difference between the purchase price and the selling price of the goods, expressed as a percentage or currency.
6. Quality of purchased products:
- Why it matters: Low-quality goods lead to returns, additional replacement costs and customer losses. Quality products contribute to customer satisfaction and cost reduction.
- How to measure: Number of returns, percentage of defects, customer feedback.
7. Optimization of procurement costs:
- Why it matters: Reducing the costs of purchasing, logistics and storage directly affects the company's profit. Optimizing these costs improves financial results.
- How to measure: Total costs for purchasing, transportation and storage as a percentage of the total cost of purchased goods.
Properly selected KPIs help to effectively manage purchases and maintain high margins, which ultimately contributes to business growth and stability.
Learn more about how Smartup can improve the efficiency of your business. Contact us today!
