Inventory and stock
What is FEFO? First expired, first out explained
Definition
FEFO: FEFO (first expired, first out) means always selling, dispatching or using the batch with the earliest expiry date first, whatever order the batches arrived in.
Also called: first expired, first out, first expiry, first out, FEFO method, FEFO meaning
What FEFO means
FEFO is a picking rule for anything with an expiry date: food, spices, medicines, cosmetics and chemicals. When you hold several batches of one product, the batch that expires first leaves first.
FEFO is often confused with FIFO, first in, first out, which sends out the stock that arrived first. Most of the time the two give the same answer, because older stock usually expires sooner. They differ when a supplier sends old stock, when goods come back from a customer, or when one product comes from two suppliers or production runs with different shelf lives. In each case FIFO can leave a short-dated batch on the shelf until it expires. FEFO does not.
How to follow FEFO in a godown or shop
FEFO only works if the expiry date is visible at the moment someone picks stock.
- Write the expiry date in large letters on every carton, crate and sack as it arrives.
- Keep batches of one product apart, with the earliest expiry at the front or on top.
- Pick by reading the date, not by taking the nearest carton.
- Every week, list what expires in the next 30 days and push those batches first.
- Move expired stock away from saleable stock the day it expires.
- Record the batch on every dispatch, so you can check FEFO was followed.
Common FEFO mistakes
The usual failures are mixing two batches in one bin, so nobody knows which is older, and not recording the expiry date at receipt, so FEFO depends on memory. Another is sending a nearly expired batch to a customer who needs months of shelf life. Shops and distributors may refuse short-dated stock or send it back later, so match the batch to the customer, and move short-dated stock through buyers who will use it in time.
Worked example
FEFO versus FIFO for a namkeen distributor
A distributor holds two batches of one namkeen. Batch A arrived on 2 October with 400 packs expiring on 31 January. Batch B arrived on 12 October with 250 packs expiring on 15 December, because the supplier sent older stock. On 20 October a retailer orders 300 packs. FIFO takes all 300 from batch A and leaves batch B's 250 packs to expire in under two months. FEFO takes all 250 from batch B and 50 from batch A, leaving 350 packs that are good until January. At a cost of ₹40 a pack, FEFO protects ₹10,000 of stock.
In managemate
managemate follows FEFO by default. Deliveries, counter sales, production runs, transfers and write-offs take the lot with the earliest expiry date first, unless you scan a lot QR label or choose a lot yourself. Stock without an expiry date goes last, and lots with the same expiry date go in the order they were first recorded. Expired lots cannot be sold or used in production, and the counter refuses a scanned label from an expired lot. Lots expiring within 30 days show in Inventory's Expiring in 30 days tab and in Today's plan on the dashboard.
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