Inbound and outbound logistics — What They Are and Important KPIs to Track

Inbound and Outbound Logistics — What They Are and Important KPIs to Track

By Nick Bartlett on December 13, 2022
Want to learn more about inbound and outbound logistics? Check out our article explaining these two stages and how to optimize each one.

Whether you are selling chocolate bars or robot vacuums that clean your floors while you nap,  any business selling products needs to deal with two things: inbound and outbound logistics. 

So, what exactly are inbound and outbound logistics? 

Inbound and outbound logistics are two parts that make up the whole of your supply chain. Inbound logistics refers to the first half— the processes that bring the materials or products to your business.

Once you have the finished product at your warehouse, outbound logistics takes over. The outbound logistics stage refers to all the actions related to and necessary for delivering products to customers.

For inbound, the goal is to secure the supply for your company. For outbound, the goal is to fill demand.

Whether you are managing your inbound/outbound logistics with an in-house team or outsourcing services to a 3PL or 4PL, it's imperative to a successful supply chain strategy that they work well in harmony. 

How can you achieve that? By using data analytics and KPIs, or key performance indicators, to diagnose problems and help you understand what is going on in your supply chain.

Read through our list of inbound and outbound processes, then check out some of the KPIs e-commerce retailers rely on to evaluate and optimize their inbound and outbound logistics. 

Read about CBIP's Adaptable 4PL Logistics Services

What is inbound versus outbound logistics and who is involved?

As noted above, the components of your supply chain can all be grouped into two main categories; Inbound and outbound logistics.

Looking at the below list, consider which parts you best understand when it comes to your company. How well do you know what’s going on with the “players” in your inbound and outbound logistics?

What processes are part of inbound logistics?

The term “Inbound logistics” encompasses everything that happens between sourcing the raw materials for your product and the moment when the finished product enters the warehouse to await orders.

Inbound processes include:

  1. Finding materials
  2. Managing transportation from source to factory and factory to warehouse
  3. Warehousing

The parties involved in inbound logistics are responsible for transporting, storing, and receiving your materials and goods. Starting from the supplier, your product moves down the chain to manufacturers, then freight companies, and finally ends up at your warehouse. 

What processes make up outbound logistics?

Inbound logistics includes all processes that happen after the customer’s order comes in. This includes order fulfillment and last mile, returns, and general customer service after the parcel is delivered.

Outbound processes include

  1. Confirming and processing inventory at the warehouse
  2. Picking and packaging orders as they come in
  3. Last-Mile Delivery
  4. Returns and post-delivery customer service

The outbound part of logistics is when orders are packaged up and delivered to the customer. 

Related: How to Manage B2B Fulfillment Today

How to optimize both outbound and inbound using KPIs 

Getting a handle on all outbound and inbound processes can seem like a daunting task — it can be challenging to figure out a problem in one area of a supply chain, let alone all of them consistently.

We'd suggest using a checklist of the most telling KPIs, or key performance indicators, to point out areas where you are killing it, and areas that need some work or outsourced help. KPIs use data analytics to tell you how specific areas of your business are performing.

The biggest indicators that retailers are tracking in the inbound processes are:

  • Freight bill accuracy
  • Loading and unloading times
  • Lead times
  • Production times

For inbound logistics, time and accuracy rule the roost. Nearly 34% of companies have had to ship out a late order because they didn’t actually have a product in stock. That kind of lack of insight into what inventory your warehouse has on hand can cause major customer frustrations.

Think of the children’s game “telephone”— if accurate documentation and information are not making it down the line to each supply chain step, you will end up with a faulty message.

When we’re talking about outbound KPIs, the most important considerations are how accurately orders are filled and how long the last mile of fulfillment winds up taking. After the orders come in, you should be looking at indicators like:

  • Order fill rate
  • Order accuracy rate
  • Average delivery time
  • Customer order cycle time
  • Time to ship

Optimize outbound and inbound by teaming up with CBIP 

While new technologies in data analytics are making it easier than ever to use data from your business to make key decisions, pulling, compiling, and analyzing all the data from your inbound and outbound logistics processes can be a huge burden for companies.

When you decide to partner with us at CBIP, you get access to all the info and data from your supply chain available on our integrated platform any time you want it — not to mention an immense network of warehouses, fulfillment centers, and last-mile providers.

Interested in getting access to the data and visibility to understand better what is happening in your inbound and outbound logistics and fix bottlenecks? Reach out today to connect with one of our professionals for a free assessment.

About Author

Nick Bartlett

Nick Bartlett is CBIP’s director of sales and marketing. His expertise lies in marketing, supply chain management, and corporate retail experience. He honed his skills over 10+ years working across the Asia Pacific region and beyond.

Nick keeps a close eye on new markets and believes successful business operations come through value-based relationships.

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FAQs

Every e-commerce brand or seller is a little different. So, the best way for us to provide you with a detailed quote is to fill out our online questionnaire here and from here we can walk you through the various options available to you with CBIP Logistics.

No, we do not charge the higher fee associated with long-term storage. No matter how long the goods remain in our warehouse. They are charged the same rate for inventory storage.

Yes! We can store your inventory and replenish Amazon as necessary, helping you adhere to Amazon’s strict rules and regulations for packaging, labeling and shipping.

We charge for storage by either cubic meter, sqft or per pallet / racking space per week. It depends on the request from the customer as one-size doesn’t fit all. It would be better if you schedule a call with us

We provide a variety of services in the logistics landscape which includes Ocean Freight, Airfreight, Domestic Delivery, Warehouse & Distribution and Customs Clearance & Brokerage.

We offer several types of warehouses that are tailored to your requirements and vary among countries, e.g. Bonded Warehouse, General Warehouse, Consolidated Warehouse and Distribution Center.

Yes, you can track it from our platform by using the “Log In” function and access to “B2B” which is dedicated to track any shipment you have with us. This is a real-time platform which integrates with some major carriers so from here you can get the visibility of vessels on the globe map.

  • Origin Management: digital PO management and connected suppliers supported by agnostic 3PL vendor management capabilities.

  • Shipment Tracker: real time tracking also vessel tracking to let you know where the goods are.

  • Destination Management: platform manage the delivery to Distribution Centre and update frequently on platform.

  • Paperless Handling: we centralize the document hub on the platform for shipment-by-shipment. From here you can get the full documentation of a particular shipment within a click.

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Every business, we have a dedicated Account Manager who is the focal contact point that you can get in touch for daily operation.

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