Backorder Rate
What is the Backorder Rate?
Backorder rate indicates how many orders cannot be fulfilled immediately and must be delivered at a later time.
Formula
(Backorders ÷ total orders) × 100
Example
50 out of 1,000 orders cannot be fulfilled immediately
→ Backorder rate = 5%
Benchmarks
- < 2% → good
- 2–5% → critical
- > 5% → problematic
Significance
A high backorder rate leads to:
- poor customer experience
- increased operational effort
- revenue losses
Causes of poor Performance
- inaccurate forecasts
- insufficient inventory
- supply issues
Optimization
- better replenishment planning
- adjust safety stock
- supplier management
Typical Mistakes
👉 Backorders are often underestimated because they become visible with a delay.
Relation to other KPIs
- fill rate
- days of inventory
- forecast accuracy
Practical Example
Reduction from 6% to 1.5%:
→ significantly higher customer satisfaction
❓ FAQ
Are backorders always worse?
Yes – they should be avoided whenever possible.
Wie misst man sie?
Über offene Aufträge im System.
Conclusion
The backorder rate is a clear indicator of issues in planning and inventory management.