A Complete Guide to Batch Tracking in Inventory Management


Inventory management systems have simplified business management in a number of ways like inventory control, real-time tracking, and automation are some of the benefits. Many new features are introduced in the inventory management systems from time to time. Batch tracking is one of the many useful functions of it. This article is dedicated to the batch tracking feature of inventory management system. So, let's explore! 

What is Batch Tracking?

The process of tracking a whole batch of items along the distribution channel using the batch numbers is termed as batch tracking. 

An inventory batch or lot is a set of items received on a specific day. These items may differ in size and color. But they are manufactured together with the same materials. Hence, they have some similar features like manufacturing and expiry date. Each batch or lot is assigned a specific batch number. This number is used to track the items in a batch. 

For example, a batch of bread is a set of items that are produced (baked) on the same day with the same ingredients. It has the same expiry date. Hence tracking the whole batch is better to avoid any undesirable conditions.  

Batch tracking enhances the efficiency of business processes. It allows the companies to track the products throughout the distribution channel. From production to shipment, batch tracking allows complete visibility.

Why is Batch Tracking Important?

Batch tracking allows companies to track their products from production to selling. It simplifies the whole trading process. Clearly, tracking each and every product is an arduous task. Keeping a record of every item's expiry and manufacturing date is tough. But with batch tracking, you have items categorized in their specific batch. You can easily allot them a number and decide what to do with the lot. Some other reasons as to why the company should adopt batch tracking are:

  • It's time-saving.

  • Batch tracking helps track expiry dates accurately.

  • It helps analyze the sales and returns from a certain batch of items. 

  • It enables you to identify the exact customers who received a product from a specific batch.

  • It optimizes inventory handling throughout the distribution chain.

  • Batch tracking enables you to create more accurate reports. 

Batch tracking is especially crucial for handling products that are decomposable and have an expiry date. For example, food, beverage and pharmaceutical industries.

Common Batch Tracking Strategies in Inventory Management System

Many strategies are in practice in batch tracking and management. Some of the most common ones are:

  1. FIFO (First in First Out) 

In this strategy, the batch of products that come in first will be sold first. This strategy is in practice in companies that sell fast-moving products. For example, dairy products, fruit and vegetables, and over-the-counter drugs. 

  1. LIFO (Last in First Out)

In LIFO, the batch of products that come in last will be sent out in the market first. This is used for items that don't have a shelf life. For example, apparel, accessories, etc.

  1. FEFO (First Expired First Out)

In this method, the products with the closest expiry dates are sold first. FEFO is used for products that come with an expiry date. For example, baked products, beverages, etc.

Benefits of Using Batch Tracking

Today, almost every business is using batch tracking due to its countless benefits. Here are some of the most common benefits of batch tracking.

  • Simplified Expiration Tracking

If you deal with perishable products, batch tracking is very important for your business.  Decomposable products can only be used before their expiry date. Hence it is important to know the expiry date of your products. Batch tracking simplifies this process. Through batch tracking, products with the same expiry date are categorized together. Each item can then be processed according to the expiry date. 

  • Strong Relationships with Suppliers

Through batch tracking, you can identify the right supplier. It enables insight into the raw materials. The finished product quality can also be monitored through batch tracking. These insights allow you to identify the supplier who provides better quality products. 

  • Better Product Quality

Batch tracking allows you to track the products from production to selling. This enables you to know the quality of the raw materials and hence the finished product. You can identify good quality products and enhance your overall product quality.

  • Minimum Chances of Error

Manual tracking is time-consuming as well as more prone to mistakes. However, batch tracking is very easy and error-free. You can easily add or alter data. It provides more accurate data. The chances for any mistakes are minimum. 

Get started with batch tracking!

The benefits of batch tracking demonstrate its importance in inventory management. The best way to get started with batch tracking is by using a cloud-based inventory management system. The right inventory management system will make batch tracking very easy. So, what are you waiting for? 

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