Next, we want to assess the level of service impacting the customer that arrives in the Coca-Cola department at the Walmart supermarket. The same formula applies to measure the service rate with the 3 axes: quantity, quality, and lead time. Then, the Walmart warehouse will receive orders from its stores. If Walmart orders 100,000 bottles, but Coca-Cola can only deliver 90,000 within the time limits, then we have a service rate of 90%. The first step in measuring the level of service is to measure the percentage of service between these two players, therefore the percentage of quantities delivered, the level of quality, and the level of lead time. It naturally distributes Coca-Cola products in stores, but also on its website for home deliveries.įirst, you have the Coca-Cola factory, which will deliver to the Walmart warehouse where pallets of Coca-Cola products are going to be stored. Walmart was number 1 in distribution (before being overtaken by Amazon), and has very large supermarkets, mainly in the United States. Let’s start with an example between Coca-Cola and Walmart. You will always measure this rate between a seller/supplier and a customer via 3 main approaches :ĭifferences between availability rate and service rate? Whichever your position in the Supply Chain, it is imperative to measure your service rate to improve your performance and your customer satisfaction. In order to help you, we will focus on the service level: how to measure it and how to improve it. It seems obvious, yet on the ground, it is more complicated. How to have a profitable Supply Chain? The answer may seem obvious: improve the level of service for your customers while minimizing inventory levels as well as production costs.

5) It’s ok to have shortage, just relax and take a step back.2) Do not target 100% service rate and fill rate.

1) Pay attention to the quality of your data.

5 tips (and mistakes to avoid) to boost your service level.

Availability rate : calculations on Excel.

Differences between availability rate and service rate?.

Time calculation formula for excel