Certified Logistics Technician (CLT) Practice Exam

The inventory control method where the oldest items received are the first to be sold or delivered is known as FIFO, which stands for "First In, First Out." This approach is particularly beneficial in industries where products may have a shelf life, such as food products or pharmaceuticals, ensuring that older inventory is used before it becomes obsolete or spoiled. By using FIFO, companies can reduce waste, maintain inventory freshness, and improve customer satisfaction by delivering products that are still in their prime.

In contrast, LIFO, or "Last In, First Out," would sell the most recently received items first, which can lead to older stock remaining on the shelves longer. Just-in-Time focuses on inventory reduction and relies on demand-driven production schedules without necessarily adhering to the principle of item age. ABC Analysis categorizes inventory into different classes based on importance or value, rather than governing the order of sale based on age. Each of these methods serves different operational strategies but only FIFO ensures that the oldest stock is prioritized for sale or delivery.