What is First In / First Out (FIFO)?

First In/First Out (FIFO) is an inventory control method that uses the oldest items in inventory first, based on the date of receipt. This means the items received into inventory are the first to be shipped out or used in production.

FIFO is commonly used in warehousing and logistics to manage inventory levels and ensure that goods are not left in storage for extended periods. This method helps to prevent inventory spoilage or obsolescence and ensures that products are shipped or used in the order in which they were received. FIFO is an effective way to manage inventory for products with a limited shelf life, such as food or pharmaceuticals, and is also used for other types of goods. The FIFO method can be used with other inventory management techniques to optimise supply chain efficiency and reduce waste.