Lot tracking, also known as batch tracking, is the process of assigning unique identifiers (lot numbers or batch numbers) to groups of materials or products that were produced or received together.
Lot tracking is widely used in industries where quality control, traceability, and regulatory compliance are essential, such as food and beverage, pharmaceuticals, chemicals, cosmetics, and other industries dealing with perishable goods.
Lot tracking makes it easier to trace products backwards to their source and forward to the customers or locations they were shipped to. When customer complaints or potential product issues are discovered, lot tracking can help businesses quickly analyze and summarize the status of inventory from different production dates and suppliers based on lot number. This can help them decide whether to conduct a unified recall for an entire batch of goods.
Lot tracking also helps businesses apply FIFO (First-In-First-Out) inventory management better. In FIFO, the oldest stock is issued or sold first before newer stock. It is useful for keeping track of product expiration dates, coordinating with different business functions, deciding which batches of goods to prioritize for shipment, and ensuring proper disposal of expired or obsolete items.
Having an information system for lot tracking can help by:
1. Centralizing lot data— Details such as suppliers, production dates, storage locations, and quantities are stored in a single source of truth.
2. Automating lot number assignment— Systems can auto-generate unique batch numbers based on business requirements, such as date-based, sequential, supplier-based, etc.
3. Enforcing traceability workflows— Every movement, including receiving, production, picking, and shipping are linked to the lot number, preventing data gaps.
4. Real-time tracking— Users can immediately see which lots are available, which are approaching their expiry dates, and where they are in the supply chain.
5. Supporting compliance reporting— Businesses can easily generate reports for audits or regulatory reviews.
While lot numbers are identifiers for groups or batches of items, serial numbers are typically used to identify a single item. Lot numbers are best used for high-volume identical items like food and cosmetics, while serial numbers are best used for high-value individual units like electronics and equipment. In many cases, businesses and systems may use both at once.
