The ability to track inventory by production lot or batch number from receipt through to outbound shipment.
Lot tracking (also called batch tracking) is the capability to assign a lot or batch number to a group of products manufactured or received together, and then track that lot number through every step of the supply chain — from supplier receipt to customer delivery. This enables precise traceability: if a quality issue is discovered, you can identify exactly which customers received products from the affected lot and recall precisely.
Lot tracking is mandatory for FDA-regulated products (food, supplements, pharmaceuticals, some cosmetics) and strongly recommended for any brand that may face product liability or recall scenarios. A 3PL's WMS must support lot-level tracking — not just SKU-level — to comply with food safety and supplement regulations.
In practice, lot tracking means: every incoming receipt is assigned a lot number (or the manufacturer's lot is captured), every pick is allocated from a specific lot, and every outbound shipment record includes the lot number shipped. This creates a complete audit trail that can be queried within minutes in a recall scenario.
A complete lot trace report shows: lot number, product received date, quantity received, any outbound orders that included units from that lot (with order dates, ship dates, and customer addresses), and current remaining inventory from that lot. You should be able to pull this report within 30 minutes in a recall scenario.
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