You work with a carrier. Goods go out, sometimes they arrive on time, sometimes they do not. Whether there is damage — you are not entirely sure. At the end of the month, an invoice arrives and you pay it. But you have never actually measured whether that carrier is doing a good job. This is the situation for many small and medium-sized businesses in Turkey. Every lira counts for companies still recovering from the 2001 economic crisis, yet logistics costs are still tracked by eye. This is exactly where a logistics scorecard becomes useful.
A logistics scorecard is a tracking tool that measures transport and distribution processes using a small number of key indicators. Think of it like a school report card: grades for each subject. For a carrier, the scorecard works the same way. On-time delivery rate, damage rate, unit transport cost, and vehicle utilization rate are the four core grades on this card. When these four indicators are tracked properly, it becomes clear which carrier is performing well and which one is not meeting the terms of its contract.
On-time delivery rate is the easiest indicator to understand. The dispatch date and the actual delivery date are recorded for each shipment. The planned date is then compared with the actual date. If eighty out of a hundred deliveries arrived on time, the on-time rate is eighty percent. Tracking this figure month by month gives a concrete picture of carrier performance. Damage rate works in a similar way: the number of damaged or missing packages is compared against the total number of packages sent. When this rate climbs above two percent, it is time to have a serious conversation with the carrier.
Unit transport cost is an indicator that most small businesses overlook. Dividing the total freight invoice by the number of packages or kilograms shipped is all it takes. A business that does this calculation every month will quickly notice price increases or inefficiencies from its carrier. Vehicle utilization rate is closely related: if a truck is running at fifty percent capacity, money is being wasted on every trip. Tracking utilization gives a concrete reason to fix shipment planning and consolidate loads.
Putting these four indicators into an Excel spreadsheet already makes a significant difference. For those who want a more structured approach, SCM (supply chain management) software produces this scorecard automatically. These programs are still relatively new in Turkey. Large companies use systems like SAP; for smaller businesses, local software vendors offer logistics tracking modules. When shipment records are entered into these programs, performance indicators are calculated at the same time. At the end of the month, a report printed from the screen or sent to the printer delivers a ready-made scorecard.
The real power of the scorecard comes when it is tied directly to carrier contracts. It is entirely possible to include a clause such as: ‘If the monthly on-time delivery rate falls below eighty percent, a ten percent discount will be applied to the freight charge.’ Or: ‘If the damage rate exceeds three percent, the cost of damaged goods will be borne by the carrier.’ Clauses like these push carriers to maintain their performance. In Turkey, transport contracts are often kept loose — price is discussed but performance criteria are not. When the scorecard figures are in hand, however, that conversation becomes much easier to have.
Designing a logistics scorecard does not require a large budget or expensive software. To start, three steps are enough: record every shipment with its date and package count, note damages and delays in a separate column, and calculate the four indicators at the end of each month. Once this habit is in place, carrier meetings are entered with numbers rather than gut feeling. For a small business owner looking to bring down logistics costs, this scorecard is the most practical tool available.
This article was originally written in Turkish by Gökhan MERCANOĞLU on June 16, 2003 and has been automatically translated into English and other languages using machine translation.