Eight performance analysis indicators of effective supply chain management (Part 1)

Supply chain is a very complex 、 Systematic ecosystem , From raw materials 、 To suppliers 、 To produce 、 Warehouse 、 logistics , Finally arrive at the dealer or end customer , This chain is very long . There are also many related analysis indicators , There are also many summaries and explanations of these indicators on the Internet .

I have sorted out eight key indicators in the supply chain to share and interpret with you , It's a framework , Many detailed contents can be expanded in the future . These indicators can also help enterprises understand the overall operation level of the supply chain , Where is the efficiency , Where is the inefficiency , We should be able to see these in time and constantly maintain or optimize .

Let's talk about the first four indicators , They are closely related to finance , So let's talk about it separately .

first KPI,Cash to Cash Time Cycle Cash flow cycle . It can be very intuitive to describe the time from paying cash to suppliers to receiving cash from customers , Inventory turnover cycle + Receivable period - Payable period , The cycle from cash payment to cash recovery , The shorter the time, the better , Ensure that enterprises can use less working capital to carry out business . This one KPI There is a very detailed explanation in the previous video , You can see the previous video .

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the second KPI,Total Supply Chain Management Costs Total cost of supply chain management . It refers to the cost incurred in the whole supply chain operation process from placing an order to executing and completing the order , such as ： Sourcing purchase cost 、 Manufacturing costs 、 Logistics cost 、 Inventory cost 、 quality cost 、 Financial costs and some indirect costs ： Like order management 、 plan 、 Development 、 New product introduction, etc .

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First, understand the total cost of supply chain management in general , And the ratio of total cost to revenue . The overall cost advantage of first-class companies in supply chain management is very obvious , It only accounts for about of the income 5%~6% less . You can see the industry in which the enterprise is located , Compare the industry average with the highest level , For example, communication equipment industry , The total cost of the first-class supply chain accounts for about 3.3% about , Industry average 8.5%; Chemical and pharmaceutical , First class 4%, Industry average 9.8%; In this way, we can probably know the difference between us .

This also involves the concept of cost-effectiveness , The benefit of an activity must be greater than the cost , But most of the time, we can't think roughly from the perspective of cost-effectiveness . For example, the inventory cost has been reduced , Out of stock costs may increase 、 Procurement cost 、 Production costs 、 Transportation costs may also increase . Shortage costs have been reduced , Inventory costs may also increase . Press the gourd to lift the ladle , Even more ladles , So behind this indicator is very complex , We need to think as a whole .

Third KPI,Inventory Turnover Inventory turnover , Also called inventory turnover . A very important indicator , Finance and supply chain will pay close attention to an indicator . Is the ratio of cost of goods sold to average inventory , It is also generally called inventory turnover times , If it is expressed in time, it is the inventory turnover days . Usually, the faster the inventory turnover , The lower the occupancy level of inventory , The more liquid , The faster inventory is converted into cash or accounts receivable . therefore , Improving inventory turnover can improve the liquidity of enterprises .

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Generally, this indicator should be compared in the industry , Different industries vary greatly . For example, the manufacturing industry is generally 2~3 Next year , Converted into turnover days, it is probably 120-180 God ; The commodity circulation industry is about 4~6 Next year , Converted into turnover days is 60~90 God .

But like the real estate industry, the inventory turnover rate is only 0.2-0.4 Very low , Is it really bad , It's not , Because the cycle of building a house itself is very long , The whole industry is far lower than other industries , Simple analysis of inventory turnover for the real estate industry can not provide managers with much valuable information . from ROE From the angle of , The real estate industry mainly relies on equity multipliers 、 Leverage funds to pry , I talked about this before ROE I talked about it in my article , Interested students can have a look at .

The fourth one KPI,DSO Day Sales Outstanding Days sales outstanding . It refers to the enterprise from the right to obtain accounts receivable to the recovery of funds 、 The time required to convert into cash , It is used to measure how long it takes an enterprise to collect accounts receivable ,DSO The shorter the number of days , Explain that the faster the payment is collected , The more efficient the use of working capital . It feels a little windy, doesn't it , It can be understood as the accounting period . This KPI It is very relevant to the cash flow cycle indicators mentioned above , A / R period plus inventory turnover period minus a / P period equals cash period .

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DSO The formula of is ： Average accounts receivable balance / Average daily sales , Understand from the formula , That is, according to the current sales situation , Estimated number of days to digest the existing accounts receivable balance . such as DSO The turnover days of accounts receivable are equal to 50, This means that the average enterprise needs 50 Genius can collect payment from customers .

Is there any DSO Accounts receivable turnover days are zero , You can see the financial report of xiahaitian flavor industry , A few tenths 、 Less than one , Explain what , It's too strong in the upstream and downstream of suppliers . Generally, such large-scale supermarkets need to press your goods , There is an accounting period for suppliers . Haitian flavor industry in turn , There is no accounting period , Payment before delivery . Accounts payable turnover days are dozens of days , Haitian flavor industry will also occupy the payment of upstream suppliers , Goods before payment , Eat both ends , The position of the industry can be seen .

therefore , The analysis of this indicator is still very interesting . But this formula seems simple , But in the actual calculation process , You may encounter various situations , Result in different calculation results . For example, some enterprises discount and collect money at the end of each quarter, especially at the end of the second quarter of listed companies , Revenue surged , Therefore, there will be some differences in turnover days , Short is four 、 Five days , More than ten days . There are also factors such as the collection of large customers , And the way revenue is recognized will also lead to DSO Different , I can talk about the differences in detail later .

well , Today's sharing is here . Next time we will share the remaining five indicators . Friends who like our content , Welcome to support , Thank you. .