Table 1

Definition of MSD performance indicators

IndicatorDefinitionPrimary source
Stock AvailabilityThis indicator measures the percentage of availability of a specific product or products that the site is experienced to provide at any point within a defined period of time. For all items listed as tracers, this indicator measures the percentage of days when items at Central /Zonal warehouse have been at stock level above safety stock; which is 1 month of stock at any time during the month.EPICOR
Order fill rateThe rate at which customer orders can be filled from existing zonal inventory within the parameters of the order request. This indicator measures the percentage of items ordered that are received to determine whether an order is filled in the correct quantities with the correct products. This indicator can be used to measure individual products (line fill rate) or for an entire order. The purpose here is to determine how effective MSD is satisfying customer orders. A higher fill rate is usually equated to higher customer satisfactionEPICOR
Integrated logistics system (ILS) delivery coverageThis indicator measures the percentage of (ILS) orders shipments delivered on time at primary healthcare facilities at the set and agreed delivery schedule (ie, dates) during a defined period of timeElmis/EPICOR
Sales /revenuesRevenue, often referred to as sales, is the income received from normal business operations and other business activities of MSD. For MSD, this is indicative of the volume of health commodities distributed and their corresponding monetary value. For MSD, preference is to calculate sales on a quarterly and annually basis.Financial statements
Cost of goods soldCost of goods sold includes all of the costs directly related to the procurement of the medicines and health commodities distributed by MSD. For MSD, preference is to calculate the cost of goods sold on a quarterly and annually basis.Financial statements
Gross marginGross margin is the difference between the revenue and the cost of goods sold, for a specific period of time.
Other incomes and grantsShows the contribution of other sources of revenue (such as clearing and forwarding, leasing of fleet for transportation by clients, etc) to the total MSD revenueFinancial statements
ExpensesThis is the monetary value of MSD’s expenses that are related to its business operations, for example, rent, electricity, administration, maintenance, etc.Financial statements
Other gains and lossesThis indicates the level of contribution of nonrecurring events for example, write offs, sales of assets on the gains and losses to the overall profitability of MSDFinancial statements
Surplus (deficits)This reveals the surplus or deficit that remains after deducting all operating expenses from the gross margin.
Note: Since MSD is a nonprofit organisation, the surplus is retained in business to cushion the declining purchasing power of the currency and finance purchase of assets and expansion
Financial statements
  • MSD, Medical Stores Department.