Warehouse KPI glossary: the definition, the formula, and the variant that changes the number.

How to read this glossary

A warehouse KPI is only useful once its definition is written down, because every common measure has variants that change the number without changing anything on the floor: units versus lines, paid versus productive hours, ship promise versus delivery promise. Each entry below gives the plain definition, the formula where there is one, the variants to watch, and the definition DC Health Check uses in its own reports so a client's weekly page and an audit agree. There are no industry benchmarks here; a benchmark without its sample, definition and date is not a standard, and a building compared with its own baseline on a fixed definition is.

Terms are alphabetical. The KPI formulas guide works four of them on a fictional week; the operations audit checklist shows where each one is used.

Terms

Absence rate

The share of scheduled labor hours lost to unplanned absence in a period.

Unplanned absent hours ÷ scheduled hours × 100

Variants that change the numberSome buildings count only no-shows; others include late starts and early leaves. Planned leave is usually excluded.

In DC Health Check reportsUnplanned absent hours only, by shift, when the schedule export exists.

Backlog (open orders) and order aging

The orders released to the warehouse but not yet shipped at a cut-off, and how old they are.

Age = cut-off time − order release (or promise) time, bucketed

Variants that change the numberAge from order date, from release date, or from promise date give different pictures. Cancelled orders sometimes vanish from the backlog without being counted.

In DC Health Check reportsAge from release time and separately from promise time; cancellations reported beside the backlog.

Cartons per hour

Shipping containers packed or shipped per labor hour.

Cartons ÷ labor hours

Variants that change the numberIncludes or excludes multi-carton orders' extra cartons; hours may be packing only or packing plus shipping.

In DC Health Check reportsPacking paid hours; every carton counted once.

Cost per line

Fulfillment cost attributed to one order line (one SKU on one order, any quantity).

Agreed fulfillment cost ÷ order lines shipped

Variants that change the numberCost scope ranges from direct labor to fully loaded including carrier and storage. See the cost per line guide.

In DC Health Check reportsAgreed direct labor cost, unless a wider scope is agreed and named.

Cost per order (labor cost per completed shipped order)

Cost attributed to one completed shipped order.

Agreed cost ÷ completed shipped orders

Variants that change the numberSame scope question as cost per line; also whether cancelled or partially shipped orders count.

In DC Health Check reportsAgreed direct labor cost ÷ completed shipped orders; partial shipments per the agreed order definition.

Cycle count

A scheduled count of a subset of locations or SKUs, used instead of, or between, full physical inventories.

Variants that change the numberCounted by location, by SKU, by zone or by velocity class; frequencies differ by class.

In DC Health Check reportsLocation-level results with expected, counted and variance.

Direct labor

Labor hours or cost for people assigned to a productive process (receiving, putaway, picking, packing, shipping).

Variants that change the numberWhether leads, trainers and quality checkers are direct or indirect is a local decision that changes every ratio built on it.

In DC Health Check reportsWritten into the definitions sheet per building; held constant.

Dock-to-stock

Elapsed time from a receipt arriving to its inventory being available to pick.

Available-to-pick timestamp − receipt timestamp, per receipt; report median and 90th percentile

Variants that change the number"Received" may mean trailer arrival, dock check-in or system receipt; "stock" may mean putaway confirmed or available to allocate.

In DC Health Check reportsSystem receipt timestamp to putaway-confirmed (available) timestamp.

Fill rate

The share of demand fulfilled from stock without a shortage.

Lines (or units, or orders) shipped complete ÷ lines (or units, or orders) ordered × 100

Variants that change the numberLine fill, unit fill and order fill are three different numbers; order fill is the harshest.

In DC Health Check reportsReported at the level the client's promise is made, and named.

Indirect labor

Labor hours or cost not assigned to a productive process: supervision, support, maintenance, cleaning, training, meetings.

Variants that change the numberThe complement of direct labor; its share of paid hours is itself a KPI.

In DC Health Check reportsIndirect share = (paid − direct) ÷ paid, where the labor export supports it.

Inventory accuracy (inventory record accuracy, IRA)

The share of counted locations (or SKUs) whose system quantity matched the physical count.

Locations counted correct ÷ locations counted × 100

Variants that change the numberTolerance-based (within a percentage) versus exact-match; by location versus by SKU; value-weighted versus count-weighted.

In DC Health Check reportsExact match by location, unless a tolerance is agreed and stated.

Labor cost per unit

Direct labor cost attributed to one shipped unit.

Agreed direct labor cost ÷ shipped units

Variants that change the numberUnits versus lines versus orders as the denominator; see the productivity guide.

In DC Health Check reportsShipped units in the period; reported beside cost per order and per line.

Lines per hour (LPH)

Order lines picked (or received) per labor hour.

Lines ÷ labor hours

Variants that change the numberPaid, direct or productive hours; picked lines versus shipped lines; per pick method.

In DC Health Check reportsLines ÷ direct paid hours, by pick method where the data allows.

Lines per order

Average number of distinct SKUs on a completed order.

Order lines shipped ÷ completed shipped orders

Variants that change the numberCounting cancelled lines or not; multi-carton orders counted once.

In DC Health Check reportsShipped lines ÷ completed shipped orders.

Labor management system (LMS)

Software that records task-level labor time and compares it with standards.

Variants that change the numberThe source of productive hours where it exists; its absence means productive-hour rates should not be quoted.

In DC Health Check reportsUsed only when the client has one; otherwise paid and direct hours only.

On-time shipment rate

The share of eligible completed orders shipped at or before their documented promised ship time.

On-time eligible completed orders ÷ eligible completed shipped orders × 100

Variants that change the numberShip promise versus delivery promise; whether equality counts as on time; orders without a promise silently included or excluded.

In DC Health Check reportsShip promise; equality counts as on time; orders without a promise reported as excluded.

Order accuracy

The share of shipped orders with no reported error (wrong item, wrong quantity, mispack, damage in pack).

Orders without a reported error ÷ orders shipped × 100

Variants that change the numberError sources differ (returns, tickets, QC audits); some buildings count only wrong-item errors.

In DC Health Check reportsAll reported error types, by type, from the agreed source.

Orders per hour

Completed orders processed per labor hour, usually for packing or for the whole building.

Orders ÷ labor hours

Variants that change the numberSensitive to lines per order; a mix shift moves it with no change on the floor.

In DC Health Check reportsOrders packed ÷ packing paid hours; reported beside lines per order.

Overtime share

The share of direct paid hours recorded as overtime.

Recorded overtime hours ÷ direct paid hours × 100

Variants that change the numberOvertime hours must be a subset of paid hours; some reports add them on top and double count. It is a share of hours, not of cost.

In DC Health Check reportsExplicitly recorded overtime hours only, as a subset of direct paid hours.

Paid hours

Every hour on the payroll for the agreed labor scope, including paid breaks, meetings, training and waiting time.

Variants that change the numberThe largest of the three hour denominators (paid, direct, productive) and the one that ties to cost.

In DC Health Check reportsThe default denominator for cost ratios.

Peak factor

The ratio of peak-period daily volume to a normal-period daily volume.

Peak daily orders ÷ baseline daily orders

Variants that change the numberPeak day, peak week and peak month give different factors; baseline may be annual average or the preceding quarter.

In DC Health Check reportsNamed per client; used in the capacity calculator as a scenario input.

Pick path and travel

The route a picker walks to complete a batch, and the share of pick time spent walking rather than picking.

Variants that change the numberMeasured from transaction timestamps and location distances, or estimated from zone frequency.

In DC Health Check reportsZone-level pick frequency from pick transactions; travel time estimated only when distances are known.

Productive (on-task) hours

Hours clocked to a task while work was available, excluding breaks, meetings, waiting and cleanup.

Variants that change the numberDepends on task clocking discipline; the smallest denominator and the most flattering.

In DC Health Check reportsQuoted only when an LMS or task clock exists; otherwise not measured.

Putaway

Moving received inventory from the dock or staging into a storage or pick location and confirming it in the system.

Variants that change the numberConfirmation time is the end of dock-to-stock; "directed" versus "free" putaway changes location accuracy.

In DC Health Check reportsPutaway-confirmed timestamp per receipt line.

Replenishment

Moving inventory from reserve storage into pick locations so picks are not short.

Variants that change the numberMin/max triggered, demand triggered or wave triggered; timeliness is measured as pick-face stockouts per shift.

In DC Health Check reportsPick-face stockouts per shift where recorded.

Shrink and inventory adjustments

Inventory lost, damaged or written off, seen as net negative adjustments by reason code.

Net adjustment value (or units) by reason code per period

Variants that change the numberGross versus net adjustments; whether cycle-count corrections are shrink or accuracy.

In DC Health Check reportsNet adjustments by reason code, cycle-count corrections shown separately.

Single-line order share

The share of completed orders with exactly one order line.

Single-line orders ÷ completed shipped orders × 100

Variants that change the numberA rise here lowers lines per order and raises cost per line with no change on the floor.

In DC Health Check reportsReported on the mix line of every weekly report.

Slotting

Assigning SKUs to pick locations so the most frequently picked items take the least travel and the right location type.

Variants that change the numberVelocity-based (picks), cube-based, or family-grouped; measured by the share of picks from the nearest zones.

In DC Health Check reportsPick frequency by location from pick transactions; the top 20% of SKUs by picks versus the zones they occupy.

Throughput and capacity

Throughput is what a process actually completed per period; capacity is what it could complete at a given staffing and rate.

Capacity = staffed productive hours × rate per productive hour

Variants that change the numberCapacity quoted at paid-hour rates overstates it; the binding process sets building capacity.

In DC Health Check reportsPer process, at productive-hour rates when known; the binding stage named. See the capacity calculator.

Units per hour (UPH)

Shipped (or picked) units per labor hour.

Units ÷ labor hours

Variants that change the numberPaid, direct or productive hours; units versus lines; blended across pick methods. See how to measure warehouse productivity.

In DC Health Check reportsShipped units ÷ direct paid hours, named in every header.

Units per line

Average quantity on an order line.

Shipped units ÷ order lines shipped

Variants that change the numberCase operations can have units per line in the dozens; each-pick DTC near one.

In DC Health Check reportsShipped units ÷ shipped lines, on the mix line.

Warehouse management system (WMS)

The software that records receipts, inventory locations, picks, packs and shipments, and produces the exports these KPIs are built from.

Variants that change the numberExamples clients export from: ShipHero, Extensiv (3PL Warehouse Manager), Logiwa, NetSuite WMS, Fishbowl, Deposco, Manhattan, Blue Yonder, Körber.

In DC Health Check reportsAny system that can export one row per event with timestamps; a spreadsheet counts if one row means one thing.