Introduction

DIFOT, or Delivery In Full On Time, is a crucial metric used in supply chain management to measure the reliability of a supplier or vendor. This metric indicates the percentage of orders delivered by a supplier on the requested delivery date and in the requested quantity. A high DIFOT percentage indicates that the supplier is reliable and efficient in meeting their commitments.

Calculating DIFOT manually can be a tedious and time-consuming process, which is why having a DIFOT calculator tool is essential for any supply chain manager. In this article, we will discuss what DIFOT is, how to calculate it, provide an example, and answer some frequently asked questions.

What is DIFOT?

As mentioned earlier, DIFOT is a metric that measures the reliability of a supplier or vendor in delivering goods on time and in full quantity. It is calculated by dividing the number of orders delivered on time and in full by the total number of orders requested.

DIFOT is important in supply chain management because it impacts the entire process from procurement to production to customer satisfaction. Late or incomplete deliveries can cause delays in production, stockouts, and dissatisfied customers, which can result in decreased sales and damaged brand reputation.

How to Calculate DIFOT?

Calculating DIFOT manually involves keeping track of all orders placed with a supplier and checking whether they were delivered on time and in full. This can be time-consuming and prone to errors. A DIFOT calculator tool simplifies this process by automating the calculations.

To calculate DIFOT using a calculator tool, you need to input the total number of orders placed with the supplier, the number of orders delivered on time and in full, and the date range for the orders. The calculator will then automatically calculate the DIFOT percentage.

Example:

Suppose a company placed 100 orders with a supplier over a three-month period, and only 80 of them were delivered on time and in full. Using a DIFOT calculator, the DIFOT percentage would be:

DIFOT = (Total units delivered on time / Total units ordered) x 100%

DIFOT = (80 / 100) x 100 = 80%

This means that the supplier delivered 80% of the orders on time and in full.

Frequently Asked Questions:

1. What is a good DIFOT percentage? A good DIFOT percentage depends on the industry and the company’s expectations. Generally, a DIFOT percentage of 95% or higher is considered good, but it can vary depending on the business’s needs.
2. Can DIFOT be improved? Yes, DIFOT can be improved by identifying the root cause of late or incomplete deliveries and implementing corrective actions. Communication with the supplier is also crucial to ensure that they are aware of the expectations and can plan accordingly.
3. What are the benefits of using a DIFOT calculator tool? Using a DIFOT calculator tool saves time and reduces errors in calculating DIFOT manually. It also provides real-time insights into the supplier’s performance, which can help in making informed decisions.

Conclusion:

DIFOT is a crucial metric in supply chain management that measures a supplier’s reliability in delivering goods on time and in full. Using a DIFOT calculator tool simplifies the process of calculating DIFOT, saves time, and reduces errors. A good DIFOT percentage can improve supply chain efficiency and customer satisfaction, leading to increased sales and a positive brand reputation.