Blue Apron (APRN) has struggled since coming public. A botched transition to its new fulfillment center in Linden, New Jersey, led the company to pull back on marketing spend as it looked to improve its fulfillment capabilities. The results were extremely disappointing for investors, and the stock plunged about 70% from its IPO price. Late last month, co-founder Matt Salzberg resigned as CEO, and CFO Brad Dickerson stepped in to fill the role.

At an investors conference this week, Dickerson said the No. 1 metric the company is looking at is something it calls OTIF, which stands for "on-time, in-full." It's a measure of how many of its orders are delivered on time and complete with all the correct ingredients. OTIF suffered during the transition to the Linden fulfillment center. Dickerson says that Linden's OTIF rate is now on par with its other fulfillment centers.

Several plates of food on a table viewed from above.

Image source: Blue Apron.

Why OTIF is so important

When Dickerson took over as CEO he talked about his goal of improving margins in the near term. During the investors conference, he repeatedly said margin is the key to unlocking growth for the company.

But if margin is the goal, why isn't margin the focus?

OTIF is one of the biggest factors that can help improve margin. If customers receive quick and accurate orders, they're more likely to order again. In markets with higher OTIF rates, Blue Apron sees better retention rates, according to Dickerson. Additionally, higher OTIF reduces the costs of customer service and replacing orders with proper ingredients or issuing refunds.

OTIF can also help combat increasing competition. Amazon is hovering around the market, and it has unparalleled fulfillment capabilities. If Blue Apron can provide superior fulfillment rates to Amazon (and anyone else in the market), it can differentiate itself.

Yet another unknown

OTIF is certainly a fine metric to focus on -- it's measurable, actionable, and theoretically drives results investors want to see. But Dickerson is committing the same sin as his predecessor.

Former CEO Salzberg previously said his focus was on lifetime value per customer. But, Blue Apron doesn't provide enough information in its financial reports to even estimate that metric.

Likewise, OTIF is a metric completely unknown to investors.

Dickerson says the metric is improving, but there's no way to tell by how much. Investors can only look to management's vague commentary and other financial indicators to ensure it's moving in the right direction. Furthermore, there's no indication of how much more room there is for the metric to improve, reducing investors' ability to estimate the potential for the company.

Blue Apron is still leaving investors in the dark with regard to retention as well. Unsurprisingly, Dickerson fielded several questions about customer retention during the investors conference, but neglected to provide much detail. Retention has been a concern for investors since the company filed its IPO registration documents with the SEC.

Stay away from Blue Apron

I was optimistic new management would give investors better insight into what the company wants to focus on. If increasing the OTIF rate is really Dickerson's primary goal, he needs to be willing to tell investors where it's been, where it is now, and where it's going. Simply pointing to margins as an indicator for OTIF isn't good enough.

Granted, Dickerson has only been CEO for a few days. The first quarterly report with him at the helm could provide a lot more detail than Blue Apron's previous reports.

But if management isn't willing to be more transparent with investors when it comes to the metrics it's focusing on, it might not be worth spending the time trying to figure out what exactly is going on with Blue Apron.