How to Train Your Staff on FIFO vs. LIFO Inventory Strategies for Construction Supply
In construction supply distribution, getting inventory out the door fast is important—but getting the right stock out in the right order is critical.
Whether you’re using FIFO (First-In, First-Out) to protect product quality or LIFO (Last-In, First-Out) for cost or space efficiency, your strategy is only as good as the people executing it.
Unfortunately, inventory mistakes often don’t come from your ERP—they come from the yard or warehouse floor, where unclear SOPs, outdated training, or high turnover lead to:
Mis-picks
Expired materials going out
Stock inconsistencies
Rework or returns from job sites
Here’s a clear and actionable guide on how to train your team to follow FIFO or LIFO strategies—and make sure your tech supports them.
🏗️ Step 1: Start With the “Why”
Before you get into process, explain why this matters to your staff.
For FIFO:
Older materials (adhesives, bagged cement, insulation) can degrade
Customers expect shelf-life-sensitive products to be fresh
Mistakes lead to warranty claims and rework
For LIFO:
Used for bulk items where freshness isn’t a concern
Common for back-stocked, commoditized SKUs
Supports pricing strategies during cost fluctuations
✅ When the team understands the why, they’re more likely to follow the how.
🧱 Step 2: Define the Strategy by SKU or Product Category
Your team needs to know which strategy applies to which material.
Use clear visual aids:
Post charts in staging areas (e.g., “FIFO ZONE – Adhesives / Sealants”)
Use color-coded bin labels
Add SKU tags with “FIFO” or “LIFO” icons
Highlight strategy rules in your ERP’s mobile picking app
✅ Consistency starts with clear classification and signage.
📲 Step 3: Leverage Your ERP and Scanning Tools
Your ERP can enforce rotation strategy through:
Location-based pick rules (e.g., pull oldest lot first)
Batch tracking or expiry-based FEFO for FIFO logic
Auto-blocking expired or aging stock
Picking sequence enforcement in mobile apps
✅ Train staff to always scan, even when materials “look the same.” That scan determines the right lot or order.
📦 Step 4: Train Using Real-Life Examples and Roleplay
Don’t just hand out PDFs. Get your team hands-on with real products and real scenarios.
Examples:
Pull two pallets of sealant—one received 90 days ago, one last week
Ask the trainee which one to ship for FIFO
Walk through what happens if it goes wrong at the job site
✅ Reinforce training with quick quizzes or refreshers during toolbox talks or team meetings.
🚛 Step 5: Include Staging and Loading Staff in Training
Mistakes don’t only happen during picking—they happen during staging and loading too.
Make sure loaders know:
The order in which products need to come off the truck (especially for LIFO logic)
How to double-check FIFO-pulled lots
What to do if something looks damaged or too old
✅ Your entire team—from picker to driver—should understand the full flow.
📊 Step 6: Track and Reinforce With KPIs
Your ERP should show you:
% of orders fulfilled correctly by FIFO or LIFO rules
Aging inventory trends
Number of expired products shipped
Return reasons tied to material condition
✅ Use this data to reward accuracy, retrain when needed, and keep your process sharp.
Final Thoughts
Inventory strategies like FIFO and LIFO aren’t just accounting terms—they’re operational realities that impact your margins, your reputation, and your job-site performance.
The key to execution? Simple, clear, hands-on training, backed by ERP automation and process visibility.
📦 Need help aligning your ERP logic, barcode tools, and training programs to enforce FIFO or LIFO properly? Let’s build a rotation strategy your team can follow—and trust.
