What is Throughput in Logistics?
Throughput refers to the amount of product, inventory, or work that flows through a warehouse, fulfilment centre, or logistics process within a specific time period. It is a measure of operational productivity, usually expressed as units per hour, orders per hour, pallets per day, or parcels per minute—depending on the type of operation.
In simple terms: throughput tells you how much work your facility can complete in a given timeframe. High throughput means efficient processes, well-designed routing, and balanced labour. Low throughput signals bottlenecks, delays, or insufficient capacity. In e-commerce, where order volumes fluctuate wildly and customer expectations for speed are high, throughput is one of the most important performance metrics.
Why Throughput Matters
Warehouses operate under time pressure: cutoffs for carriers, marketplace SLAs, customer delivery windows, and inbound schedules. Throughput determines whether a facility can meet these commitments. Increasing throughput without simply adding labour requires better processes, smarter slotting, improved layout, or automation.
In distribution networks, throughput also influences capacity planning, labour forecasting, warehouse design, equipment selection, and peak-season strategy. A facility with insufficient throughput becomes a bottleneck for the entire supply chain.
Key Functions of Throughput
Performance measurement: Indicates how efficiently orders or inventory are processed.
Capacity planning: Determines how much volume a facility can handle before requiring expansion.
Process design: Identifies bottlenecks and improvement areas.
Labour optimisation: Helps assign staff to meet demand with minimal waste.
Service levels: Directly affects order cut-off times and delivery promises.
Popular FAQ Questions About Throughput
1. What is throughput in warehousing?
Throughput in warehousing refers to how many units—such as pallets, cartons, lines, parcels, or orders—a facility can receive, process, or ship within a set period. It reflects both productivity and system capacity.
2. How is throughput calculated?
The basic formula is:
Throughput = Total units processed ÷ Time period
For example, if a warehouse ships 12,000 units in 8 hours, throughput is 1,500 units/hour.
3. What affects warehouse throughput?
Major factors include layout, slotting, picking methods, automation levels, labour skills, WMS efficiency, equipment availability, order profiles, and bottlenecks in receiving or packing.
4. What is the difference between throughput and capacity?
Capacity is the maximum potential output if everything runs perfectly. Throughput is the actual output achieved during operations. High throughput means you're operating close to capacity; low throughput indicates inefficiencies.
5. What is order throughput?
Order throughput measures how many orders (not units) are completed per hour or per day. It is especially relevant in e-commerce, where multi-line orders vary in complexity.
6. Is throughput only outbound?
No. Throughput covers inbound processing, putaway, internal moves (like replenishment), and outbound picking + shipping. Any volume flowing through the warehouse contributes to throughput.
7. What is the difference between throughput and productivity?
Productivity measures output per labour hour. Throughput measures total output regardless of workforce size. They are related but not identical.
8. Does automation increase throughput?
Typically yes. Conveyors, sorters, AMRs, AS/RS, and automated packing lines can greatly increase throughput by reducing manual travel time and handling steps.
9. What limits throughput the most?
The limiting factor is usually a bottleneck—an area where capacity is lower than the rest of the process (for example packing stations, loading docks, or insufficient replenishment speed).
10. How does throughput relate to lead time?
Higher throughput reduces internal lead times because work flows faster through the system. Low throughput increases congestion, backlogs, and delays.
Throughput in E-commerce Fulfilment
E-commerce fulfilment deals with high SKU counts, volatile order volumes, and tight delivery promises. Throughput determines whether a warehouse can meet same-day or next-day handling requirements. During peak seasons like Black Friday, throughput becomes the critical success factor.
- Forward picking zones increase pick throughput by placing high-velocity SKUs close to packers.
- Batch and wave picking improve throughput by reducing travel time.
- Automation (AMRs, sorters) allows warehouses to scale throughput without adding significant labour.
- Real-time WMS orchestration increases throughput by optimising labour and equipment use.
Throughput in Traditional Warehousing
In B2B and distribution environments, throughput affects fleet utilisation, dock operations, and service reliability. Faster receiving throughput prevents dock congestion. Higher replenishment throughput keeps pick faces stocked. Efficient outbound throughput ensures stores or clients receive goods on time.
Industries like automotive, FMCG, pharmaceuticals, and manufacturing rely heavily on throughput to maintain continuous production or shelf availability.
Best Practices for Improving Throughput
1. Reduce travel time: Slot fast-moving items in optimal areas and design efficient pick paths.
2. Maximise equipment uptime: Preventive maintenance and redundancy avoid bottlenecks.
3. Standardise processes: Consistency removes delays and errors.
4. Invest in training: Skilled staff work faster with fewer mistakes.
5. Introduce automation where it matters: Even simple conveyors or put-to-light systems can boost throughput dramatically.
Common Mistakes in Throughput Management
- Mistake: Adding labour instead of fixing bottlenecks
Impact: Costs increase but throughput barely improves. - Mistake: Ignoring replenishment throughput
Impact: Pickers stop work because pick faces are empty. - Mistake: Poor layout or slotting
Impact: Excessive walking and slow picks. - Mistake: No real-time visibility
Impact: Managers cannot react to congestion or delays. - Mistake: Underestimating peak-season needs
Impact: Cutoff failures, shipping delays, and customer dissatisfaction.
Measuring Throughput
Common KPI metrics include:
- Units processed per hour
- Orders shipped per hour
- Lines picked per labor hour
- Dock-to-stock time
- Packing throughput per station
- Average cycle time
- Peak vs. average throughput variance
Future Trends in Throughput Improvement
AI-driven orchestration: WMS powered by AI dynamically allocates labour, adjusts pick paths, and reprioritises tasks to maximise throughput in real time.
Robotics: AMRs, robotic picking, and automated sortation drastically increase throughput while stabilising labour needs.
Digital twins: Warehouses simulate throughput scenarios before making layout or equipment changes.
Micro-fulfilment: High-throughput micro-nodes serve dense urban zones with automated storage and retrieval.
Conclusion
Throughput is a foundational logistics metric that reveals how efficiently a warehouse or fulfilment centre processes goods. Improving throughput strengthens service levels, reduces operational cost, and increases reliability across the supply chain. Whether through better slotting, streamlined processes, stronger WMS control, or automation, higher throughput unlocks more capacity without major facility expansion.
For fast-growing e-commerce brands seeking higher throughput and smarter fulfilment, Waredock connects merchants to a distributed European 3PL network powered by AI-driven optimisation. Explore how multi-node fulfilment, smarter slotting, and automated routing can elevate your throughput at waredock.com.
