Determination of Performance Indicators for Warehouse Evaluation: A Case of Medium Sized Warehouses in Nakuru Town

Abstract

Evaluation of warehouse processes is required for decision making purposes and the improvement of warehouse operations. To evaluate warehouse processes, it is essential to identify key indicators in the warehouse operations. This research was intended to identify the significant indicators of warehouse performance that would support management decision making on the improvement of warehouse operations. In this research 20 indicators were identified in four warehouse activities based on Frazelle model. The most important indicators in each warehouse were then determined. The study was conducted through a descriptive design using a survey of 3 medium warehouses in Nakuru. The study employed purposive sampling to select the sample and sample elements. The sample size of 10 warehouse management officers were used in the study. Structured questionnaire was adopted as data collection instrument. The research findings indicated that most important performance indicators for receiving is productivity, for storage is space utilization, for order picking is cycle time and for shipping is productivity. Process improvement steps were proposed based on benchmarking among warehouses handling similar goods. It was noted that different types of warehouses require different indicators. The study concluded that measurement of warehouse processes is important and enables operations improvements and cost reduction. Keywords: Warehouse procedures, warehouse performance, warehouse improvement, medium sized warehouses, Nakuru town, Kenya