Some inventory has a limited lifetime, so by using the oldest inventory first, the risk of obsolescence is reduced significantly. This is particularly relevant to products which have expiry dates such as medicines, foodstuffs and cleaning products.
There are two main stock rotation processes that are used within the warehouse:
- First in First Out (FIFO) – The oldest items are used up before the newest stock items
- Last in First Out (LIFO) – The newest items of stock are used up before the oldest
Consistently using one of these rotation processes ensures good traceability for audit purposes and in the event of a product recall.