Definition
Fill rate is the percentage of customer demand fulfilled immediately from available inventory, without backorders or stockouts. It is one of the primary service level metrics in distribution. There are several variants: line fill rate (percentage of order lines shipped complete), order fill rate (percentage of complete orders shipped without any short shipment), and unit fill rate (percentage of units ordered that ship on first delivery). Industry benchmarks for B2B distributors range from 92–99%, with best-in-class operations targeting 98–99%. Fill rate is directly determined by safety stock levels relative to demand variability.
Why It Matters
Fill rate is the metric your customers actually experience. A 95% fill rate means 1 in 20 order lines requires a backorder or alternative source — which some customers tolerate and others switch suppliers over. Understanding which SKUs are dragging fill rate down and why (insufficient safety stock, poor forecasting, supplier delivery failure) is the first step to targeted improvement. Inventory Optimization Tool →
Frequently Asked Questions
What is a good fill rate for a distributor?
B2B distributors typically target 95–98% fill rate. Best-in-class operations achieve 98–99%. Below 92% is a significant competitive weakness — customers will dual-source or switch suppliers. The right target depends on your market: mission-critical parts (MRO, medical, aerospace) require 99%+ fill rate commitments.
How is fill rate calculated?
Line fill rate = (order lines shipped complete on first delivery / total order lines) × 100. Order fill rate = (complete orders with no shorts / total orders) × 100. Unit fill rate = (units shipped / units ordered) × 100. Line fill rate is the most common metric in B2B distribution.
What is the difference between fill rate and service level?
Fill rate measures actual performance (demand fulfilled from stock). Service level is a planning target that drives safety stock calculation. A 95% service level target means you set safety stock high enough to avoid a stockout on 95% of replenishment cycles — not that 95% of orders are filled immediately (which is the fill rate).