An SLA (service level agreement) is the part of the contract in which a fulfillment provider commits to measurable performance values: same-day shipping up to the cut-off time, pick accuracy above 99.9 %, returns processed within 48 hours, inventory accuracy above 99.5 %. It also defines how values are measured and what happens if they are missed.
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What is an SLA?
A service level agreement (SLA) is the part of a contract that makes the quality of a service measurable. The term comes from IT, where server availability is guaranteed as a percentage, and it has long been standard in contract logistics and 3PL relationships. In fulfillment, the SLA describes what the fulfillment provider guarantees, how it is measured, how often it is reported and what happens when a value is missed.
The SLA is distinct from the scope of services (what is done at all) and the price list (what it costs). It answers the third question: how well it is done. For online sellers it is the most important tool for steering a provider they do not see every day. That applies twice over if you are based in the UK or overseas and your stock sits in a German warehouse you may visit once a year.
Which KPIs a fulfillment SLA contains
| KPI | Definition | Realistic value 2026 (Germany) |
|---|---|---|
| Cut-off time / same-day rate | share of orders placed before the cut-off that are handed to the carrier on the same working day | cut-off 12 noon to 3 pm, rate above 98 % |
| Pick accuracy | share of order lines picked without error (right item, right quantity) | above 99.9 % |
| Inbound lead time | time from delivery to availability in shop stock, see goods receipt | 24 to 48 hours, pre-announced |
| Returns lead time | time from arrival of the return to inspection, restocking and feedback to the shop | 24 to 48 hours |
| Inventory accuracy | match between system stock and counted stock at stocktake | above 99.5 % |
| Perfect order rate | share of orders that arrive complete, on time, undamaged and correctly documented | above 97 % |
| Support response time | reply to enquiries by ticket or email | 4 to 24 hours on working days |
| System availability | uptime of client portal and integration | above 99.5 % |
For B2B deliveries, OTIF (on time, in full) is added; for time-critical ranges, the lead time per order.
How an SLA works in practice
- Definition: Every KPI gets an unambiguous measurement rule. "Same-day" means, for example: order received in the WMS by 2:00 pm German time, carrier handover scan on the same working day. Without a measurement rule every figure is open to debate.
- Measurement: The values come from the provider's warehouse management system (WMS), not from estimates. A good client portal shows them continuously.
- Reporting: A monthly report with actual values per KPI, deviations and causes.
- Consequences: Tiered credits (for example 2 to 10 % of the monthly invoice depending on the shortfall), escalation levels with an action plan, and a special right of termination for repeated misses.
- Exclusions: Force majeure, carrier failures, unannounced inbound deliveries or volume far above forecast are usually excluded. Look closely at everything the provider defines as an exclusion.
An SLA without a measurement rule and without a consequence. "We usually ship the same day" is not a service level. For every KPI, insist on a definition, a data source, a reporting rhythm and a consequence for missing it. What a provider cannot measure, it cannot guarantee.
Notes for international sellers
German fulfillment contracts are normally governed by German law and often written in German. Ask for an English version of the SLA annex, or at least an agreed English summary of the KPI definitions, and check which text prevails in case of doubt. Make sure times are stated in German local time and that "working day" is defined, because public holidays differ between German federal states. Finally, agree the reporting language and a named contact, so that a missed value is discussed in days rather than weeks.
Why an SLA matters for online sellers
Every SLA figure corresponds to a cost block or a revenue lever. A same-day rate of 98 instead of 90 % means that, at 1,000 orders a month, 80 more customers receive their parcel tomorrow rather than the day after; see same-day shipping. A pick accuracy of 99.9 instead of 99.0 % saves nine wrong shipments a month on the same 1,000 orders, each with double postage, a return and customer service, usually €15 to €30 per case in total. A returns lead time of 48 hours instead of two weeks makes stock sellable twelve days earlier and speeds up the refund, which customers perceive as a sign of quality. More on that under returns management.
During selection, ask for the actual values of the last twelve months across all existing clients, not for the targets. A provider that can quote its pick accuracy to two decimal places really does measure it.
How LogYou handles it
LogYou works with a same-day cut-off at 2 pm, a measured pick accuracy of 99.92 % and a returns process that makes goods available again within 48 hours. There is no minimum contract term. The figures come from its own platform LogShip, where clients see stock levels, order status and shipments live. The services are described under e-commerce fulfillment and returns management.
Frequently asked questions about SLA (Service Level Agreement)
Which KPIs belong in a fulfillment SLA?
Which SLA values are realistic in fulfillment?
What happens if the SLA is not met?
Questions about SLA (Service Level Agreement) for your shop?
We have been shipping parcels for e-commerce brands every day since 2014. Tell us your parcels per day and shop system — we reply with a concrete assessment.