This measure calculates the total value of all sales order line items that were not fulfilled due to lack of product availability. as a percentage of revenue. A sales order line item is an individual transaction listed on a sales order. For example, one case of product X and two cases of product Y on the same sales order would count as two line items. This measure offers valuable information regarding supply and demand. It is part of a set of Process Efficiency measures that help companies optimize the performance of their "manage sales orders" process by minimizing waste and refining resource consumption.
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Value of sales order line items not fulfilled due to production capacity or stockouts as a percentage of revenue
Total Annual Revenue/Net Revenue
Total annual revenue is net proceeds generated from the sale of products or services. This should reflect the selling price less any allowances such as quantity, discounts, rebates and returns.
For government/non-profit organizations, please use your non-pass-through budget. If your business entity is a support unit and therefore does not directly generate revenue, then provide the revenue amount for the units you support.For insurance companies the total annual revenue is the total amount of direct written premiums, excluding net investment income.
Note: Business entity revenue needs to only include inter-company business segment revenue when the transactions between those business segments are intended to reflect an arm's length transfer price and would therefore meet the regulatory requirements for external revenue reporting.
Process efficiency represents how well a process converts its inputs into outputs. A process that converts 100% of the inputs into outputs without waste is more efficient than one that converts a similar amount of inputs into fewer outputs.