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Key Performance Indicators (KPIs) are measured to assess where the factory currently stands and to find
key focus areas where management needs to look into. Top 9 KPIs have been listed and explained below that are measured by garment manufacturers (export houses) in the apparel industry. Analysis of these KPIs is carried out monthly.
1. Factory Efficiency%
Factory efficiency indicates how efficiently sewing lines is run in a factory. This indicator is important because capacity planning of the factory and projected garment making cost is done based on factory efficiency. Factory efficiency includes all lines minutes produced and total hours attended by direct labor in sewing floor. Target factory efficiency varies based on the order quantity. For the detailed calculation of efficiency refer to how to calculate efficiency of a production line or batch? For factory efficiency calculate total minutes produced by all lines and total minutes attended by all lines. Factory efficiency% = (Total minutes produced X 100)/Total minutes attended.
5. On time Delivery:
How much shipment did not meet target shipment date is analyzed at the end of each month? Target on time delivery of each style is to meet shipment delivery date. If not meet reasons of not meeting delivery date are analyzed. It is calculate as = Total orders shipped on time/Total orders shipped on the month. For example, if factory shipped 18 styles on time out of total 20 styles shipped in month then On time delivery of that month is =18/20*100% = 90%
Time gap between previous style over (last piece out from the line) and first piece output of the current style is known as style change over time. Shorter changeover time is considered as better performance level. It varies style to style and production systems. Time of Change over time of each style is recorded and average changeover time of the factory is measured.
8. Quality to Production:
Quality level of each department is measured in DHU and Percentage defective unit. Higher the value of DHU higher alteration time and higher cost incurred in quality.