How do the nation's DCs measure up?

The performance of the United States' distribution centers continues to creep upward, according to the opening keynote address at the Warehousing Education and Research Council's (WERC's) Annual Conference. Karl Manrodt, associate professor at Georgia Southern University, and Joseph Tillman, senior researcher for the consulting company Supply Chain Visions, presented the results of the seventh annual DC Velocity/WERC Warehousing Metrics Study.

This research looks at how survey respondents' facilities performed against the top 50 metrics used by distribution professionals. (The study's results were reported in the April 2010 issue of DC Velocity and in the spring issue of the Council's WERC Watch publication.) The bottom line? While numbers did not change much in the course of a year, the nation's distribution professionals continue to perform better each year against those benchmarks, Manrodt told attendees at the May 16 session. In seven of the 10 most often used metrics, performance improved across the board.

At the same time, the data showed that best performers continue to pull away from the laggards. "When you start thinking about the gap, it is greater than the numbers show," Manrodt said.

This is because the study reports median performance—that is half the respondents in each group fell above the number, and half below. That means that for each best-in-class metric, half the best-in-class performers did better than the reported number, and for each laggard metric, half of those companies classified as "having a major opportunity" fell below the number. So the gap between the very best and the very worst performers is a wider gulf than the median indicates, says Manrodt. And for eight out the ten metrics used most often, he said, the gap is significant.