On-Time In-Full (OTIF)
On-Time In-Full (OTIF) assesses whether a supplier delivers the correct quantity of products (In-Full) to the customer at the agreed-upon time (On-Time).
On-Time, or timeliness, refers to orders delivered to the customer by the scheduled date or earlier. This aspect is crucial as delays can disrupt production schedules, lead to stockouts, and ultimately affect customer satisfaction.
In-Full refers to whether the complete order was delivered without any items missing, as per the order specification. This aspect is important as partial deliveries can lead to production delays, resulting in higher labor costs due to additional handling and processing of incomplete shipments.
The OTIF metric is typically expressed as a percentage:
OTIF (%) = (Number of orders delivered on time and in full / Total number of orders) x 100
For example, if a company made 1,000 deliveries and 950 were on time and in full, the OTIF would be 95 percent. A higher OTIF percentage indicates better supply chain performance. Usually, a good OTIF score ranges from 95 percent to 99 percent, reflecting high supply chain efficiency and customer satisfaction. However, benchmarks can vary across industries, with some sectors aiming for an OTIF rate between 80 percent and 90 percent.
As OTIF metrics provide a clear benchmark for evaluating delivery performance, companies can reduce supply chain disruptions through anticipating needs and adjusting inventory levels accordingly. This allows businesses to take corrective measures swiftly, ensuring the supply chain operates smoothly without major delays.
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