OTIF is a key indicator of logistics reliability. It measures a company's ability to deliver orders on time and in full. Based on a simple calculation method that nonetheless requires shared measurement rules, OTIF is widely used to assess supplier performance.
In the race for logistics performance, speed and delivery reliability have become critical. This is precisely what OTIF (On-Time In-Full) measures. This key performance indicator assesses a company's ability to deliver an order on time and in full. Today, OTIF is one of the most widely used KPIs across supply chains. For procurement departments, it is also an essential tool for evaluating supplier performance, as part of a continuous improvement approach.
What is On-Time In-Full?
On-Time In-Full (OTIF) is a performance indicator that measures a company's ability to deliver an order on the agreed date and in full.
This relies on two essential components:
- On Time: the order is delivered on the scheduled date and time, without delay;
- In Full: the order is delivered complete, correct and to the right location.
Originally developed by Walmart, this metric is used to evaluate both supplier performance upstream and the quality of service delivered to customers downstream. Overall, it quantifies a supply chain's ability to deliver orders in line with the reference conditions agreed with its customers. It is therefore a key marker of reliability across the entire supply chain.
There is no strict reference rate as such. Targets vary depending on the sector, logistical constraints and expected service levels. However, companies generally aim for an OTIF score of between 90% and 95%.
OTIF, DIFOT, OTD: what's the difference?
OTIF (On-Time In-Full) and DIFOT (Delivered In-Full, On-Time) are synonyms. Both refer to the percentage of complete deliveries made on time, offering an overall view of logistics service quality.
OTD (On-Time Delivery), meanwhile, focuses solely on meeting delivery deadlines. It measures the percentage of orders delivered on the scheduled date, without taking into account whether the order was complete.
How to calculate On-Time In-Full?
OTIF is calculated using a simple method and a clear definition of its components.
The calculation method
To calculate OTIF, you need to measure the proportion of orders delivered both on time and in full. Both conditions must be met simultaneously. An order delivered on time but incomplete, or complete but late, is not considered OTIF-compliant.
The OTIF formula
OTIF = (number of orders delivered complete and on time / total number of orders) x 100
Let's look at a practical example: a company receives 1,000 orders from a supplier. Of these, 950 were delivered on time, and 930 in full. However, only 920 orders met both criteria. The OTIF score therefore comes to 920 / 1,000 x 100 = 92%.
A common definition
To date, there is no standardised definition of OTIF. Depending on the organisation, calculation methods and interpretations can vary, which can complicate comparisons between partners.
Several questions need to be clarified:
- Is a delivery considered ‘on time’ when it meets the date requested by the customer, or the date confirmed by the supplier?
- Is a precise delivery time slot required, or is a wider delivery window accepted?
- Is completeness assessed at the level of the entire order, each order line, or each parcel?
To ensure the indicator remains relevant, it is therefore essential to establish a shared meaning within the company, and with its partners too.
As McKinsey & Company notes, “a standard OTIF definition should be easy to understand and readily calculated using information that both retailers and manufacturers already collect. However, the definition must also account for specific requirements related to shipment characteristics (such as freight mode, temperature class, and business urgency) and other influencing factors (including freight ownership and delivery appointment availability).”.[1]
Why is OTIF key to supplier relations?
For procurement departments, OTIF is an indicator of supplier reliability. It is an objective metric, tracked and discussed with suppliers throughout the business relationship. It allows partners to be compared objectively, helps segment the supplier portfolio, and informs decision-making. OTIF is also often built into contracts or service level agreements.
A strong OTIF score results in steadier flows, fewer stockouts and disruptions, fewer claims, and better control over hidden costs. When gaps are identified, the indicator becomes a reference point for a continuous improvement approach. Customers and suppliers can then pinpoint the causes of poor performance, analyse the underlying issues, and roll out targeted action plans for improving results.
Tracking OTIF therefore helps to boost delivery performance, strengthen supplier relationships over the long term, and secure the entire supply chain.
Manutan, beyond OTIF
At Manutan, we are committed to always keeping our delivery promise. This means delivering products that match the customer's order, on the promised date, with no errors. This approach goes beyond OTIF, as it rests on honouring the promise made to the customer at every stage of their order's life cycle.
To manage this commitment, we track our delivery commitment every month. This corresponds to the percentage of orders finalised, shipped and delivered on time, with no complaints whatsoever (delays, damaged or missing products, incorrect references, surplus goods, lack of proof of delivery, and so on).
Through this commitment, we aim to offer an ever more reliable customer experience and guarantee a high level of service across the entire European market, as well as abroad through our export service.
As a key indicator of logistics performance, OTIF measures a company's ability to keep its delivery commitments. For businesses, tracking it helps build a more efficient, reliable and resilient supply chain, improve supply chain visibility, and make better use of resources.
[1]Alan Davies, Shruti Lal, Fernando Perez, Sanjhali Potdar (McKinsey & Company), Defining 'on-time, in-full' in the consumer sector, June 2019, [https://www.mckinsey.com/~/media/McKinsey/Business%20Functions/Operations/Our%20Insights/Defining%20ontime%20infull%20in%20the%20consumer%20sector/Defining-on-time-in-full-in-the-consumer-sector.pdf]
