Farmers need to find ways to quickly get their goods to market or risk losing money as the products spoil. This includes crops such as fruits, vegetables, and grains that are harvested and have a limited shelf life. Agriculture is one of the most significant industries with perishable goods.Some of the industries which have perishable inventory are:
Which Industries have Perishable Inventory? In comparison, some perishability occurs artificially, like cars that take a disproportionate hit on their values when their newer model is released in the market. Thus, the less able your business is to carry inventory forward from one period to another (be it a year, quarter, month, or day), the more perishable it is.Īlso, to be able to deal appropriately with perishable inventory, it is crucial to identify that some perishability occurs naturally like it is unsafe to eat expired food. This is because there are degrees of perishability. Thus, there is no set of rules or cutoff determining which product is perishable or not. On the other hand, even durable goods which are considered non-perishable can lose their value over time due to degradation or obsolescence.įor example, why is a loaf of bread considered perishable, while modern clothes washing machine is not? When both will become unsellable a decade or two from now, though the bread will lose its value much sooner. For instance, in the case of a theater seat, it is the theater seat that the buyer wants to buy before the curtain goes up, and not the ticket. This is because perishable stock tends to refer more specifically to perishable goods that can be stocked.įor example, floral bouquets and yogurt are both perishable inventory and stock, while rounds of golf and nights in a hotel are perishable inventory but cannot be stocked in a refrigerated warehouse like yogurt.Īlso, as you might have realized, some are not even perishable inventory in the traditional sense. While perishable inventory and perishable stock tend to be used interchangeably, they are not always equivalent. Conversely, there are other forms of perishable inventory that are not so obvious. Thus, the unique risk associated with perishable inventory is that the unsold products may expire with no residual value, leading to the entire investment and an opportunity to be lost.Īlso, as is evident, some forms of perishable inventory are easily recognized and intuitive, such as food products with printed expiration dates that are never more than a few weeks away.
For example, a computer chip that goes from state-of-the-art to good to usable to completely obsolete as successive generations get released. When the product perishes and sees a decline in its value, like a step function.For example, the value of a ticket for a seat on an airplane after the plane takes off. Or a floral bouquet that slowly dries up. For example, a market research report becomes less relevant and, therefore, less valuable over time. When product quality gradually perishes.There are three types of perishability being referred to here: Perishable inventory or perishable stock refers to the products that expire or lose value over time, thereby becoming worthless over time. How can Deskera Help You with Perishable Inventory Management?.5 Benefits of Implementing an Inventory Shelf Life Management System.10 Tips and Strategies for Managing Perishable Inventory.Why is Tracking Perishable Inventory Important?.Which Industries have Perishable Inventory?.This article will help you by covering the following topics: Thus, considering the overall challenges that surround perishable inventory and industries having to deal with them, it is necessary that you have a complete understanding of it. While these industries work with products and ingredients that expire, perishable inventory also applies to technological products.įor example, rapid advancements in computer processing technology mean that the components inside your computer will become obsolete after a certain period of time. Some of the most popular industries dealing with perishable inventories are the food and beverage industry, the medical industry, cosmetic manufacturers, and so on.
Perishable inventory includes raw materials and finished products that lose their value over time, and eventually become worthless. If your answer to either or both of these questions is yes, then this article is for you. Are you a business owner struggling with perishable inventory management? Do you want to have a better understanding of it so that you can optimize its management and increase your productivity and profitability?
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