level of service

[1MOPAR]

I cannot remember how to figure level of
service. Can anyone help me?

[Chuck Hartle]

Hi Mopar,

There are several schools of thought for measureing level of service. The best way to measure this is to take your total monthly cost of sales, subtract those parts that were special ordered or emergency purchased, and divide that dollar amount back into the total cost of sale to determine your level of service.

Depending on how you receipt parts can make a big difference in your level of service.

I hope this helps, any other thoughts on this?

Chuck Hartle'

[mnicholes]

Remember that level of service has two formula's. One, known as formula 'A' includes all transactions, including NS parts and formula 'B' removes all NS parts from the sales, lost sales and emergency purchases. For all intents and purposes this is a good measurement, but we are finding that "off the shelf fill rate" is a better one, and more accurate for what you are trying to measure.
Mike Nicholes
miknik@aol.com
Founder, MNI