LIFO vs FIFO Warehouse Racking Systems: Which is Right for Me?

There are many different options for configuring your pallet racking system, all with wide reaching effects on your warehouse efficiency and optimisation. Whether to install a LIFO or FIFO system depends on your individual requirements and stock characteristics.

What is LIFO Storage?

LIFO stands in for Last In, First Out storage. This is a system in which the last pallet to go into the storage rack sits at the front and is thus the first option taken back out. The first pallet loaded into a LIFO system will remain in place until all stock in front of it has been removed. Due to this, it is ideally used where products have a long shelf life, are in bulk, or homogeneous, and will not lose value over time. This system requires only one aisle as pallets will be loaded and unloaded from the same side.

What is FIFO Storage?

FIFO stands for First in, First Out storage. This is a system in which the first pallet to enter the racking system is the first to be picked and taken out. This negates the need for manual product rotation and requires two aisles, one for loading, and one for unloading so that the first loaded product can be removed from the other end. This is more effective when storage perishable goods, or those with a limited shelf life that need frequent rotation.

The Advantages of LIFO Storage

A LIFO storage system is a high density system due to its construction requiring only one aisle for forklift access, allowing for as large an area as possible to be used for storage. This also helps to increase productivity as pallets can be loaded and unloaded at once, requiring no additional movement or forklift traffic. This provides a streamlining of the warehouse and allows for process optimisation. When products have a high density, fast turnover, and long shelf life, LIFO storage may be the most efficient and effective option.

The LIFO construction can be applied to numerous commonly used storage systems including; push back racking, drive in racking, and double deep racking formations.

The Advantages of FIFO Storage

One of the most significant advantages of FIFO storage is that it facilitates automated stock rotation, by loading and unloading from opposite ends. This increases productivity as it eliminates a time consuming stage of the process. It also helps to eliminate product waste or expiry, particularly when dealing with time sensitive stock, as the oldest product is picked first. This system can also effectively maximise warehouse space, as in some configurations, aisles are only needed at the very front and back rather than throughout - for example in pallet flow racking.

The FIFO construction can also be used with many different storage systems including; pallet flow racking, drive through racking, and standard selective pallet racking.

While both of these pallet racking systems and configurations have significant advantages and disadvantages, only your individual stock and rotation requirements can determine which is the most efficient method for you. Luckily, here at DC Space and Storage Solutions, we’re always on hand to discuss, design, and install a system that will enable you to reach maximum efficiency within your warehouse. Get in touch today to see what we can do for you!