Expert: Peter A. Crosby - 9/9/2006

Question
Dear Sir,

What is the objective or purpose of maintaining FIFO system in stores (other than accounting/costing point of view)

Answer
Dear Paresh:

FIFO means, first-in-first out.  The primary purpose of FIFO inventory management practice in retail stores is to rotate stock so that it remains fresh, new, and in good condition for the consumer.  This practice reduces returns and inventory write downs.

Sincerely,

Pete Crosby
CGR Management Consultants LLC
(310) 553-6837
petecrosby@cgrmc.com