What is OTIF in the supply chain?

Aren’t there enough acronyms on this spinning marble? No! There’s always room for one more — come on in; the fire’s crackling.

On-time and in-full (OTIF) delivery is a critical metric for measuring the performance of your supply chain. OTIF tracks whether your products are reaching customers when promised, and in the correct quantities. It's a key indicator of how well your logistics operations are running.

OTIF is especially important for consumer brands that are committed to delivering a seamless customer experience. Every positive order fulfillment builds loyalty, while late or incomplete deliveries can erode trust and drive customers away.

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What is OTIF?

OTIF stands for "on-time and in-full" delivery. It measures two key aspects of your supply chain:

On-time: The percentage of orders that are delivered to the customer by the promised date. This requires carefully coordinating production, inventory, and transportation to ensure products arrive when expected.

In-full: The percentage of orders that are delivered with the full quantity the customer ordered. Maintaining high in-full rates means minimizing stockouts, back-orders, and other fulfillment issues.

Together, on-time and in-full delivery creates an optimal customer experience. When an order is both on-time and complete, it builds trust, satisfaction, and the likelihood of repeat business.

Tracking OTIF provides valuable insights into the health and efficiency of your supply chain. By closely monitoring these metrics, you can identify problem areas, make strategic improvements, and ultimately exceed customer expectations.

Why is OTIF important?

OTIF is a crucial performance indicator for several reasons:

1. Customer satisfaction: On-time and in-full deliveries are key to meeting customer expectations and maintaining loyalty. Anything less can lead to negative reviews, returns, and churn.
2. Operational efficiency: OTIF reflects how well your supply chain is functioning. By identifying issues that impact on-time or in-full performance, you can optimize processes and reduce costly errors.
3. Competitive advantage: In today's fast-paced consumer landscape, reliable order fulfillment is a major differentiator. Brands that consistently deliver on OTIF stand out from the competition.

4. Revenue growth: Positive customer experiences drive repeat business and referrals. Maintaining high OTIF rates is essential for sustainable revenue growth, especially for e-commerce and direct-to-consumer brands.

How to improve OTIF

Improving OTIF performance requires a holistic view of your supply chain operations.

The most important step in improving OTIF numbers is to measure them accurately. Collect comprehensive data on your order fulfillment process, from inventory levels to carrier performance. Automated tools can help consolidate this information for easy tracking and analysis.

Armed with accurate, up-to-date data, brands can begin to identify challenges and set goals. Use your OTIF data to pinpoint the root causes of delivery issues, whether it's production delays, shipping errors, or a secret third option. With these root causes in mind, you can establish realistic OTIF goals for your business, considering both historical trends and industry benchmarks.

After goal-setting, it’s time to make process changes. Implement lean manufacturing principles, streamline workflows, and leverage technology to enhance efficiency and resilience across your supply chain. Collaborate closely with 3PLs, suppliers, and other vendors to align on OTIF priorities and hold each other accountable.

Automating OTIF tracking with Parabola

One of the biggest challenges in measuring OTIF performance is getting comprehensive visibility into your supply chain data. Order, inventory, and shipping information are often scattered across multiple systems, making it difficult to consolidate and analyze.

This is where automated tools like Parabola can make a big difference. Parabola is designed to pull data from every corner of your tech stack, transform it into actionable insights, and deliver real-time reporting on key metrics like OTIF.

With Parabola, you can build a vendor scorecarding workflow that pulls in order fulfillment, status, and shipping data from your 3PL's API; calculates on-time and in-full delivery rates by channel, over time; compares performance to historical benchmarks and target goals; and visualizes the results in an easy-to-understand dashboard

By consolidating all your OTIF data in one centralized system, you can quickly identify issues, uncover trends, and make data-driven decisions to improve your supply chain operations. Automating this process frees up your logistics team to focus on strategic initiatives rather than manual reporting.

Ultimately, the power of Parabola for OTIF tracking is about transforming murky data into clear, actionable insights. With comprehensive visibility and the ability to quickly analyze performance, you can turn your supply chain into a competitive advantage and deliver an exceptional customer experience.