Lot Tracking and FEFO at a 3PL

By 3PL for DTC Editorial · Updated September 27, 2026 · How we research

Quick answer

To make your 3PL ship by expiration date, you need three things in writing: 1) every SKU flagged as lot-controlled in the 3PL's WMS, with lot number and expiry captured at receiving; 2) allocation set to FEFO (first expired, first out), so the WMS assigns the unit with the earliest expiry to each order; and 3) a minimum remaining shelf-life rule that blocks lots too close to expiry from shipping. Then test it: receive two lots of one SKU, place orders, and check which lot ships.

Key takeaways

FEFO means the unit with the earliest expiration date ships first, regardless of when it arrived.
FIFO (first in, first out) is not the same: a later-arriving lot can expire sooner.
Lot and expiry must be captured at receiving; a WMS can't allocate by data it never recorded.
GS1 barcodes carry lot in Application Identifier (10) and expiration date in AI (17).
Supplement cGMP rules (21 CFR 111.475) require records of product distribution, which is what lets you run a lot-level recall.

What is FEFO in fulfillment, and how is it different from FIFO?

FEFO (first expired, first out) tells the warehouse system to allocate the unit with the earliest expiration date to each order. FIFO (first in, first out) allocates the unit that was received first.

They usually give the same answer, and that's the trap. When they don't, FIFO ships the wrong lot:

Lot	Received	Expires	FIFO ships	FEFO ships
A	March 1	December 2027	First	Second
B	March 15	August 2027	Second	First

This happens whenever a co-manufacturer sends an older run late, when returns come back into stock, or when you transfer stock between warehouses. If your product has an expiry or best-by date, ask for FEFO, not FIFO.

How do 3PLs handle lot tracking and expiration dates?

A 3PL that supports lot control does it in the WMS at three points:

Receiving. The dock records lot number and expiration date for every carton, either by scanning a GS1 barcode (lot in AI 10, expiry in AI 17) or by keying it from your ASN.
Storage. Each bin or pallet location holds one lot per SKU, or the WMS tracks lot per unit in mixed locations.
Allocation and picking. The WMS assigns a specific lot to each order line, and the picker scans to confirm it.

If any step is manual or optional, lot control breaks. The most common failure is step 2: two lots commingled in one bin, and the picker grabs whichever is in front.

What should you send your 3PL to set up lot control?

Before your first lot-controlled inbound, send:

A SKU list marking which SKUs are lot-controlled and which are expiry-controlled (usually both).
Date format printed on your product (MM/YYYY, DD/MM/YYYY, or a Julian date code) and where on the pack it appears. Ambiguous formats cause misreads at receiving.
Minimum remaining shelf life per channel. For example, "don't ship DTC orders with fewer than 90 days to expiry"; retail buyers often set their own, stricter rules. These numbers are yours to set. Ask your retail partners for theirs.
Carton labels showing SKU, lot, expiry and quantity, ideally as a GS1-128 barcode.
An ASN per inbound listing lot and expiry per carton.
Disposition rules for short-dated and expired stock: quarantine, return to you, donate or destroy (with a certificate).

What should you ask a 3PL before you trust its FEFO?

Ask these, and get the answers in writing:

Is lot and expiry capture mandatory at receiving for my SKUs, or can a receiver skip it?
Does the WMS allocate by FEFO automatically, or does the picker choose?
Can a bin hold more than one lot of the same SKU? If yes, how is the lot verified at pick?
Can you enforce a minimum shelf-life rule per channel (DTC vs. Amazon vs. retail)?
Can I see on-hand by lot and expiry in the portal, and export it?
Can you give me a lot-level shipment report (which orders got which lot) within 24 hours if I have a recall?
How do returns get their lot recorded, or are they quarantined?
What do you charge for lot-controlled receiving? Some 3PLs price it as extra receiving labor.

A 3PL that answers "we do FIFO, it's basically the same" isn't set up for expiring goods.

Why does lot tracking matter for recalls and compliance?

If you have to pull a lot, you need to know exactly which customers received it. Without lot-level shipment records, your only option is recalling everything.

For dietary supplements, FDA's cGMP rule makes this a records requirement: 21 CFR 111.475 requires written procedures for holding and distributing operations and records of product distribution, and 21 CFR 111.455 requires holding products under appropriate conditions of temperature, humidity and light. See the supplement fulfillment guide.

For certain foods, FDA's Food Traceability Rule (FSMA 204) adds lot-level recordkeeping. Congress directed FDA not to enforce it before July 20, 2028, but it applies to foods on FDA's Food Traceability List, so check whether yours are on it.

How do you test that FEFO is actually working?

Run this check at go-live and then quarterly:

Seed test: receive two lots of one SKU with different expiries, the later-expiring lot first. Place five test orders. Every one should ship the earlier-expiring lot.
Portal check: compare on-hand by lot in the 3PL's portal to what you sent.
Short-date report: ask for a monthly list of lots within your shelf-life threshold so you can run a promotion before they expire.
Spot audit: during a cycle count, ask the 3PL to photograph the lot codes in the pick face for your top SKUs.

If the counts by lot don't reconcile, treat it like any other count variance. See 3PL inventory discrepancies.

Frequently asked questions

What does FEFO stand for?

First expired, first out: the warehouse ships the unit with the earliest expiration date first.

Do all 3PLs support lot tracking?

No. Many run lot tracking as an optional WMS feature, and some only support FIFO. Ask whether capture is mandatory at receiving and whether allocation is automatic.

Is FEFO required by law?

FDA rules don't mandate FEFO as a picking method. Supplement cGMP rules do require distribution records and proper holding conditions, and FEFO is the practical way to avoid shipping expired product.

Does lot tracking cost extra at a 3PL?

Sometimes. Capturing lot and expiry adds receiving labor, and some 3PLs bill it as a separate receiving charge. Ask for it as a line item in your quote.

What's the difference between lot tracking and serial tracking?

Lot tracking groups units made in one production run under one lot number; serial tracking identifies each individual unit. Consumables use lots; electronics usually use serials.