What does FIFO stand for in inventory management?

FIFO stands for "First In, First Out," which is a crucial concept in inventory management, especially in the food industry. This method ensures that the oldest stock, or the items that were received first, is used or sold before newer stock. This approach is vital for maintaining food safety and quality, as it helps prevent the use of expired or spoiled items. By utilizing FIFO, food establishments can minimize waste, reduce the risk of serving outdated products, and ensure that customers receive fresh goods.

The importance of FIFO is particularly evident when dealing with perishable items, such as fruits, vegetables, dairy, and meat. These items have a limited shelf life, and adhering to the FIFO method helps to ensure that inventory is rotated appropriately, thereby maintaining safety and compliance with food safety regulations. This practice is widely recognized and implemented in various food handling and storage practices, making it an essential concept for food handlers and managers alike.