Yield Ratio
The yield ratio is a performance metric that shows the percentage of profitable shipments compared to the total number of shipments handled. It helps logistics teams understand how much of their operational volume is actually contributing to profit. Rather than looking only at revenue, it focuses on the quality of earnings. This makes it a more meaningful indicator of business health.
In freight operations, a high yield ratio means most shipments are priced correctly and cover operational costs. A low yield ratio may indicate underpriced cargo, inefficient routing, or poor cost control. By tracking this ratio, teams can identify patterns across customers, routes, or services. It helps highlight where margins are being lost.
The yield ratio is often used alongside metrics like yield, volume, and cost per shipment. Together, these figures provide a clearer picture of performance. Management teams use the ratio to refine pricing strategies and capacity decisions. It supports more disciplined commercial planning.
Overall, the yield ratio helps measure how effectively a freight operation converts activity into profit. It shifts focus from volume to value. It supports smarter decision-making. And it helps improve long-term profitability and operational efficiency.
Frequently Asked Questions about Yield Ratio
Clear answers to the most common questions people have when learning about Yield Ratio.
It shows how many shipments are actually profitable, helping teams focus on quality revenue instead of just volume.
Yes. If many shipments are underpriced or high-cost, volume can increase while profitability remains low.
By reviewing pricing accuracy, reducing inefficient routes, controlling costs, and prioritizing higher-margin shipments.