February 24, 2022
Understanding Lot Tracking and Lot Control: A Guide for Food and Bev Merchants
This blog post was originally published by Deliverr, which is now Flexport. The content has been adjusted to fit the Flexport brand voice and tone, but all other information remains unchanged. With the merging of Deliverr’s services (DTC fulfillment, B2B distribution, and Last Mile delivery) into Flexport’s existing international freight and technology services, we’re now able to provide merchants with true end-to-end logistics solutions spanning from the factory floor to the customer’s door.
Shopping for food online has become increasingly popular over the past two years as a direct reflection of the COVID-19 pandemic. Nothing is off the table anymore—from 1-hour grocery delivery services to consumers buying their favorite snacks from DTC websites, for example. But with the perishable nature of these products coupled with expiration dates, delivery trackability is essential.
The supply chain comes with several moving parts, and oftentimes deliveries are fulfilled through multiple distribution centers. It’s easy for products to go untraced in warehouses if you don’t have a process in place. If there is no established process that tracks deliveries for food and beverages, recalled and expired items can still make their way to fulfillment, leaving a brand with a damaged reputation or the need to recall entire shipments, which results in a lot of wasted products (and money).
To reduce issues with delivering food and beverage products, a tracking system can make your life easier. This system can help you easily track where products came from, and where they are being stored. This is helpful because food and beverage products are likely to have specialized storing and tracking needs.
One of the most common ways to organize and track inventory is lot tracking. Keep reading to learn more about lot tracking, why it’s important for food and beverage brands, and why a 3PL partner is useful:
What Are Lot Tracking and Lot Control?
Lot tracking and lot control are best practices in warehouses. It helps organize and store products to ensure quality control, traceability, and proper fulfillment. It’s used to trace specific ingredients back to a supplier.
Lot control ensures every piece of inventory can be traced back to its origin. This inventory management process typically organizes products by:
- Expiration date
- Production date
For example, if you’re storing products by expiration date, you can ensure the products with the earliest expiration dates are used first.
With lot tracking and lot control, each lot needs its own storage space (it can’t be stored with other batches of the same products), meaning costs can quickly add up. However, lot tracking can help you save money when it comes to recalled ingredients – if you know which products include the recalled ingredients, you only need to recall those specific orders.
To make lot tracking and lot control more manageable, warehouses can track based on license plates, bins, or individual boxes. Pick what level of specificity you want to track your inventory with and stick with it.
The license plate level is typically the easiest and most efficient to use, and it requires less warehouse space and manpower. Produce license plates typically include shelf data, expiration date, and production date. With the license plates, all your warehouse workers have to do is scan the license plate to get the data they need for the recall reports.
License plating is a way to keep track of your batches electronically. If you know what batches your products came from (down to the specific batch), you can only recall the products that are tainted. This is more cost-effective than making nationwide recalls.
Here are some benefits of lot tracking and lot control:
- Easily understand product failures and issues
- Avoid human error
- Identify inventory trends
- Understand landing costs
- Avoid waste, spillage, and contamination
- Achieve regulatory compliance
Why Are Lot Tracking and Lot Control Important for Food and Beverage Brands?
Achieving regulatory compliance is one benefit of lot tracking and lot control, and that benefit is the reason why these warehouse processes are so essential for food and beverage brands. When shipping food and beverage products, compliance with the US Food and Drug Administration (FDA) is required by law due to regulatory ingredients and expiration dates.
Brands that sell food or beverages directly to consumers must use an FDA-certified warehouse. This can help you avoid FDA recalls, which come with hefty fines and harm to your brand.
Here’s how to become an FDA-certified warehouse:
- Register your facilities with the FDA
- By registering, you agree to be inspected every 3 years
- Pass your inspections
- Receive FDA-approval
All products that require FDA approval must use a lot tracking and lot control system. Otherwise, there’s really no way to trace the produce to its origin to keep track of expiration dates and recalls.
Another regulatory body that creates and enforces standards for delivering food and beverages is the International Organization of Standardization (ISO). ISO writes, “Applicable to all types of producer, ISO 22000 provides a layer of reassurance within the global food supply chain, helping products cross borders and bringing people food that they can trust.”
Lot tracking and lot control can help you reach FDA and ISO regulatory compliance, making it particularly important for food and beverage eCommerce retailers. Your food and beverage products need to be safe and healthy for consumers to consume.
Why a 3PL Partner Is Helpful
To make lot tracking easier, you can outsource logistics work to a third-party business. Third-party logistics (or 3PL) providers can offer solutions to your lot tracking problems while you focus on growing your business.
For example, Flexport provides strategic locations that allow you to meet customer demands for fast shipping. By strategically placing inventory closer to demand, your brand can rest assured that items will arrive quickly and without spoiling.
Flexport is currently testing new lot tracking services with a few merchants. If you are interested in participating in the Beta program, visit our Help Center for more information on how to get started.
The contents of this blog are made available for informational purposes only and should not be relied upon for any legal, business, or financial decisions. We do not guarantee, represent, or warrant the accuracy or reliability of any of the contents of this blog because they are based on Flexport’s current beliefs, expectations, and assumptions, about which there can be no assurance due to various anticipated and unanticipated events that may occur. This blog has been prepared to the best of Flexport’s knowledge and research; however, the information presented in this blog herein may not reflect the most current regulatory or industry developments. Neither Flexport nor its advisors or affiliates shall be liable for any losses that arise in any way due to the reliance on the contents contained in this blog.