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Tips & Tricks for Perishable Inventory Management

Yitz Lieblich
December 12, 2019

Inventory management is hard enough, yet it goes up a few notches when managing perishable inventory. Any manufacturer or retailer of food and beverage items, cosmetics, pharmaceuticals, nutraceuticals, or anything that has an expiration date will be well acquainted with this issue. The biggest pain points are ensuring the sale of inventory before its expiration date, and the ability to easily identify and remove recently expired inventory

 

How can you ensure that perishable items are sold before their expiration date?

There are a few answers to this question. However, the one that is most effective for perishable items is the FIFO/FEFO method. FIFO stands for First In First Out. This is actually as simple as it sounds, items that arrive first in the warehouse are sold and shipped first. FEFO stands for First Expired First Out. Similar to FIFO, except this time items are sold first based on their expiration date not on their arrival into the warehouse.

 

While this method sounds straightforward, it will require some time and effort to properly implement.

 

Five tips to help you implement FIFO/FEFO warehousing.

  1. Date products as they enter the warehouse (for FIFO) or locate product expiration date (FEFO)
  2. Place items with soonest dates in the front
  3. Load new items with the latest dates in the back
  4. Sell items in the front first
  5. Constantly rotate stock on shelves in this manner

 

Benefits of using FIFO/FEFO Inventory Management

FIFO/FEFO inventory management is not for all companies. But those with perishable items will see the following benefits:

  1. Reduced spoilage - Using the FIFO/FEFO method to ship out older products first, less inventory will be lost due to spoilage or items being passed their expiration date.
  2. Reduced obsolete inventory - Obsolete inventory is when inventory wallows on the shelf until it is either outdated or out of style. (This can be true for both perishable items and clothing.) Using FIFO/FEFO will allow items to be shipped out before they become obsolete.
  3. Quality Control - Using dates to track inventory will help with quality control. If a product is entered into inventory and is damaged or spoiled, there will be an easy way to track which supplier provided the inventory and when it entered the warehouse.

 

Click here to see how to implement this solution using a commerce operations platform.

 

SkuNexus is a fully customizable inventory/order/warehouse management platform. With SkuNexus running your backend commerce operations, implementing FIFO/FEFO inventory management will be a breeze. 

 

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