Why Not Having Lot Control in Your Warehouse is a Huge Gamble

It’s 3 AM, and one of your customers is calling you in a panic because the BBQ sauce they make needs to be recalled. It seems that some sauce being sold in the Pacific Northwest has a chemical contaminant in it that’s making people sick. After some testing, your client was able to determine that the contaminant came from a specific batch of tomatoes used to make the sauce. This is every warehouse manager's nightmare.

How can you recall the affected sauce, eliminate the contaminant’s future damage, and minimize financial and reputational losses for your customer? Lot control.

What is Lot Control?

Lot control itself is a rather simple concept that ensures every piece of inventory that flows through a warehouse can be tracked to its group of origin. A “lot” is a specific batch of an item that was received, is currently stored, or was shipped from your warehouse. The criteria that constitute a lot can be determined at an organizational level by anything from the materials that went into a product to its expiration dates. Every lot is assigned a unique number to facilitate tracking. While the concept is simple, the actual tracking of lots can be incredibly complex in a highly matrixed supply chain if your system does not support lot control.

Back to the nightmare scenario, we led off with. Lot control makes a huge difference in how your reaction to this event is going to go down. Which scenario would you rather choose?

Scenario 1 — Your WMS does not have lot control in it. You cannot identify the specific batches of sauce impacted by the contaminant and your client has to recall everything. Everything. The FDA shuts you down for non-compliance and your organization is subject to crippling fines.

Scenario 2 — Your WMS has lot control built-in. You can quickly run a report and have everything your customer needs to give to the FDA in 10 minutes. You can go back to bed and still get a solid night of sleep.

Why Do You Need Lot Control?

A cloud warehouse management system with built-in lot control has a dramatic impact on your organization’s ability to track inventory and respond to issues. Lot control also tracks complete chain of custody and is a key component to earning FDA 21 CFR Part 11 validation. Lot control is essential for performing the following:

Recalls — Should you ever have the unfortunate experience of dealing with a product recall, lot control can help you quickly identify which batches were defective and to whom the batches were sent. You can then quickly reach out to halt sales of the product. The FDA requires that all lot numbers affected by a recall be transmitted to their offices within 60 minutes of the request. A cloud-based warehouse management system with lot control functionality reports lot information almost instantly, so you beat that deadline without breaking a sweat. This helps diffuse the situation immediately by getting the right items off the shelves and out of harm’s way as quickly as possible.

Expiration Dates — Especially important for the food and beverage industries, being able to track lots by expiration date will help ensure timely distribution from your warehouse. If an expired product happens to stay in your warehouse too long, the lot number will help you identify that the product is expired and should be dropped from your inventory and disposed of.

Product Differentiation — Everybody dealing with wood grains and dye colors is going to need lots to ensure materials that may be dissimilar are not mixed. Slight variations can exist between each batch for some products. While there may be no safety hazards involved in a product like carpeting, there can actually be color shade differences from batch to batch even if the color was intended to be the same.

If your current warehouse management system doesn’t have robust lot control functionality, now is the time to move to a cloud-based WMS. Huge technological advances in the past few years have led to low setup costs, incredibly low user license fees, and immense business intelligence improvements. A new WMS with lot control will help your business reduce costs, streamline operations, and increase throughput. Not utilizing lot control functionality in your WMS is a gamble your business should not take. Reach out to our team of WMS experts to get started exploring advanced, cloud-based solutions for warehouse management, today.