Case study

Don’t struggle with inventory control: Operate a FIFO warehouse instead!

Jul 7, 2023 | Pallet Racking, Uncategorized

FIFO or First-in First-out is a method with equal function to the First-come First-served concept which is to serve in order of arrival. With FIFO however, the concept refers to physical items rather than people, entering a ready queue to be processed in order of arrival.

This is a common logic you probably use yourself at home, because when you replenish the items in your refrigerator you are likely to place the new items behind the existing ones to prevent the newest items from being consumed first whilst the older ones are left to perish.

The motivation to adopt the FIFO method in the warehouse operation is to manipulate inventory flow in such a way that goods are routinely shipped out in order of acquirement.

For instance, if a warehouse was to receive three deliveries of the same goods in a single week, the items that entered the warehouse on the Wednesday will leave before those that entered on the Thursday, but after those that entered on the Tuesday.

The FIFO Warehouse Diagram

So, what drives a FIFO Warehouse Operation?

Time-critical goods!! The longer an item sits in a warehouse, the more time it has to decline in quality, functionality or desirability.

The FIFO method offers logic in how the warehouse manages inventory flow to prevent old and new merchandise being mixed up before being shipped. It encourages a sequential process from items received to shipment where they remain in arrival order throughout. By operating on this basis, the frontal picking face is consistently occupied by the oldest items, so there is very little risk of them being bypassed during the retrieval process. This is a huge advantage because it minimises the risk of accumulating obsolete stock which will incur costs as it takes up valuable space, time and resources. Whilst this is a great advantage to any warehouse holding sellable goods or raw materials, the warehouse handling perishable goods are particularly motivated to adopt the FIFO method because goods that are managed in arrival order are systematically managed in shelf-life order. This rotary motion means there is no need to check individual dates by hand, and the risk of holding stock past its shelf life date is minimised.

How to establish a FIFO Warehouse Operation?

Using the simple logic of oldest to newest, FIFO is an uncomplicated method and one which is widely used and trusted, however the principles of FIFO can be easy to overlooked when dealing with high inventory volumes alongside time constraints. For this reason a FIFO orientated storage solution is an ideal option:

Diagram First in first out

Pallet live racking – Store your pallets in arrival and date order within the long running deep lanes of a pallet live racking system. The structure provides dense pallet storage with a single aisle dedicated to loading the pallets on one side with a single access aisle for picking the pallets on the opposing side. In between the pick and loading aisles are multiple lanes of deep storage on multiple levels, in a grid-like format.  Once a pallet is loaded it joins a queue of existing pallets and the line moves forward each time a frontal pallet is picked. The movement is driven by the natural force of gravity given that the structure is slightly inclined and the floor of the lanes consist of rollers to allow the pallets to glide until they reach the front face where stoppers prevent them from falling. From here the frontal pallet is picked and the pallet behind is then able to move forward and this is how the FIFO method is activated.

Drive-through racking – This is a distinctive FIFO system because the structure is without the horizontal beams and instead the long running lanes are fitted with a ledge on both sides of the lane ant at each level. This allows the FLT to enter the structure to place or pick the pallets. The FIFO method can be incorporated through access entry on both ends of the lanes to allow pallets to be loaded on one side and retrieved on the other side.

Drive-through racking system

Shuttle racking – This is another deep storage solution with continual lanes and no aisle between them. The shuttle racking system incorporates a radio-controlled shuttle which transports the pallets deeper into the lane towards the picking face. The shuttle sits on the mouth of the lane on the loading side and once the pallet is placed, the shuttle transports it and then returns to collect the next pallet.

Carton live shelving – Ideal for fast flowing, perishable products which are hand loaded rather than palletised, carton live shelving is a smart dynamic system. Like the pallet live system, the shelf bed has a slight incline with rollers on which trays, boxes of individual items able to travel from the loading side to the picking face.

Carton Live shelving

Benefits of a FIFO warehouse operation

The most significant benefit of a FIFO warehouse operation is the most obvious – the risk of obsolete stock in the warehouse is minimised, but how else can your warehouse benefit from a FIFO method?

Reduced handling – With the FIFO method comes simplified picking and put-away processes. The tasks take much less time to complete as the method takes away the need to look through all of the pallets and units to check dates.

Streamlining – Because FIFO follows a simple and straightforward process, there’s not much room for confusion. Each stage of the process is systematic with items and operators in the right place at the right time.

Improved quality management – The orderly flow of goods in a FIFO warehouse reduces opportunities for inventory spoilage. By the time the goods reach the customer, quality is retained which adequate time remaining for consumption.

Increased storage capacity – Storage solutions that facilitate the FIFO method are commonly deep storage configurations. Without the working aisle between each row of racking, storage capacity is increased instantly and significantly.

Increased warehouse safety – When operating a FIFO warehouse, FLT activity is simplified and minimised. The dynamic systems such as the shuttle racking and gravity fed flow systems do all of the work once the pallet has been loaded. The FLT will only access the picking and loading face so there is minimal risk of collision with each other trucks or with the structure. Even the drive-through racking system where the truck enters the lane has in-built guide rails to ensure that any veering of the trucks whilst in motion has no impact on the structure itself.

A FIFO Warehouse Operation Designed by WSL

At WSL we understand that assisted stock rotation, whilst crucial, is just one operational requirement we need to meet when designing your warehouse storage solution. When designing your FIFO system, we look to meet all of your operational needs including speed, volume, space and your budget. Whether you’re FIFO based solution consists of dynamic picking shelves, compact drive-through racks or a fully automated racking system, your bespoke solution will be designed and implemented to support all aspects of your operation.

Take the first step towards achieving a successful and prosperous FIFO warehouse today by contacting WSL! Call us on 0113 2045350 or email sales@wslmail.co.uk

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