FEFO explained: first-expiry, first-out for medical supplies

If you keep medicines, test kits or any other product with an expiry date, the order in which you hand stock out decides how much of it you end up throwing away. FEFO (first-expiry, first-out, also written "first expired, first out") is the rule health supply chains commonly use to keep that number low. This article explains what FEFO is, shows with worked numbers why it beats FIFO for dated stock, covers where it cannot help, and shows how OpenBoxes applies it.

The products, lots and quantities below are invented examples.

FEFO and FIFO#

• FIFO (first in, first out) issues the stock that arrived first.
• FEFO (first-expiry, first-out) issues the stock that expires first, whenever it arrived.

For most deliveries the two give the same answer, because stock that arrived earlier usually expires earlier. They part ways when a later delivery carries a shorter date, for example with a donated consignment, an emergency purchase from a different supplier, or stock redistributed from another site.

Example 1: three lots of oral rehydration salts#

A store holds three lots of the same product:

• Lot A, received in March, expires June 2027.
• Lot B, received in May, expires February 2027.
• Lot C, received in July, expires January 2028.

FIFO issues lot A first, because it arrived first. FEFO issues lot B first, because it expires first, even though it arrived two months after lot A.

Why it matters: the arithmetic of waste#

Example 2: the same stock, two picking rules#

A clinic store uses 200 units a month of a product and holds two lots:

• Lot B: 600 units, expiring in 4 months.
• Lot A: 500 units, expiring in 7 months. Lot A arrived first.

Under FIFO, the store issues lot A first. At 200 a month, lot A lasts 500 ÷ 200 = 2.5 months. The store then moves to lot B for the remaining 1.5 months before B expires, and uses 1.5 × 200 = 300 units of it. The other 300 units of lot B expire on the shelf.

Under FEFO, the store issues lot B first. At 200 a month, lot B lasts 600 ÷ 200 = 3 months, which is before its 4-month expiry, so all of it is used. The store then issues lot A from month 3. It has 4 months left before lot A expires and would use 800 units in that time, but only 500 remain, so lot A runs out at month 5.5, well before its date. Nothing expires.

Same stock, same demand, and the only difference is the order of picking: 300 units wasted against none.

Where FEFO cannot help#

FEFO makes sure the earliest dates are used first. It cannot make a store use more than it consumes.

Example 3: too much stock for the time left#

A store holds 1,000 units of one lot expiring in 3 months and uses 200 a month. Even if every unit issued comes from that lot, the store will use 3 × 200 = 600 before the date. The other 400 units will expire whatever the picking rule.

When the quantity on hand exceeds what you will use before the expiry date, the options are outside the store room: redistribute to a site that uses more, return to the supplier if your agreement allows it, or plan the write-off. The earlier you see it, the more of those options you still have. Comparing quantity on hand with average monthly consumption, as in Months of stock, is how you see it early.

Putting FEFO into practice#

A picking rule is only as good as the information behind it. The habits that make FEFO work:

1. Record the lot number and expiry date at receipt. Without them, no system and no person can tell which unit expires first. Take them from the packaging when the goods arrive, not later.
2. Arrange the shelf to match. Put the earliest-expiring stock where it is picked first, usually the front, so the physical habit and the rule agree.
3. Check the date again when picking. A lot suggested by a system can still be the wrong one if the expiry was keyed incorrectly at receipt. A quick look at the label catches it.
4. Think about the receiving site. Sending a short-dated lot to a site that uses little of the product just moves the waste. For short-dated stock, the right destination is the site that will use it in time.
5. Review what is expiring on a schedule. A regular look at stock expiring in the next month gives you time to redistribute. Waiting for the expiry date gives you only the write-off.
6. Write off expired stock promptly. Record it as an expiry adjustment so it stops counting as available stock.

FEFO in OpenBoxes#

OpenBoxes records each lot with its lot number, expiry date and quantity. The product's Lot and expiry control setting makes both fields required at receipt, which is the simplest way to make sure FEFO has a date to sort by. See Inventory for how lots and expiry dates are tracked.

When you create a stock movement, OpenBoxes suggests lots using FEFO: the lot closest to expiry is suggested first. During picking, warehouse staff work through each line, confirming the lot, the bin location and the quantity actually picked, so the suggestion is a starting point that the picker confirms. The Stock Movements guide walks through the request, pick and pack steps.

The suggestion depends on the data. A lot received without an expiry date, or with a wrong one, is suggested in the wrong order. That is why recording lots accurately at receipt (see Receiving) matters as much as the rule itself.

For the review side, OpenBoxes gives you:

• the Expiration Summary on the dashboard, which groups stock by how close it is to expiry;
• the Expired Stock Report and the Expiring Stock report under Reporting, Inventory Reports, where you choose a window of 30, 90, 180 or 365 days.

To record expired stock, use an inventory adjustment on the product's stock card with an expiry reason, which keeps a record of who made it and why.

Getting expiring stock sent to you with OpenBoxes Lift#

On OpenBoxes Lift, you do not have to remember to run the report. The optional daily stock alert email lists the lots whose expiry date falls inside a window you choose (30, 60, 90, 180 or 365 days), grouped by location, soonest to expire first, with the lot number, the expiry date and the quantity on hand. Someone on your account switches it on under Integrations, Destinations, Stock alerts, and it is included on your plan.

Two limits are worth knowing. The email is sent once a day, not the moment something changes. And it lists stock that is approaching expiry: a lot that has already passed its date is not in it, so use the expired-stock views in your instance for those.

The Reports page in the portal also has an Expiring stock card, which groups lots by how soon they expire and shows the value at risk for lots with a price (visible to the account owner and admins, unless the account owner shows values to all teammates).

Summary#

• FEFO issues the earliest expiry first; FIFO issues the earliest arrival first.
• For dated stock, FEFO avoids waste that FIFO creates whenever a later delivery expires sooner.
• FEFO cannot fix overstock: when you hold more than you will use before the date, act early.
• OpenBoxes suggests lots by FEFO when you pick, as long as lots and expiry dates are recorded at receipt.

The short video Expiry, Lots and Reports shows lot numbers, expiry dates and the reports that track them.