What is LIFO principle in SAP LE-WM - Warehouse Management?

SAP Term: LIFO principle

• Component: LE-WM

• Component Name: Warehouse Management

• Description: The principle of "last in, first out." Stock removal strategy in which goods last transferred to a storage type are the first transferred out of the storage type, known as last in, first out. The LIFO principle is set at the level of the storage type.

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• Key Concepts: 
  The Last In First Out (LIFO) principle is a method of inventory management used in SAP Warehouse Management (LE-WM). It is based on the idea that the last item to be received into inventory is the first item to be shipped out. This method is used to ensure that the most recently received items are used first, and that older items are not left sitting in inventory for too long. 
  
  How to use it: 
  In SAP Warehouse Management, the LIFO principle is used when creating outbound deliveries. When creating an outbound delivery, the system will automatically select the most recently received items first. This ensures that the oldest items are not left sitting in inventory for too long. 
  
  Tips & Tricks: 
  When using the LIFO principle, it is important to ensure that all items are properly labeled and tracked. This will help ensure that the most recently received items are always selected first when creating outbound deliveries. 
  
  Related Information: 
  The LIFO principle is just one of many methods of inventory management used in SAP Warehouse Management. Other methods include FIFO (First In First Out) and FEFO (First Expired First Out). Each method has its own advantages and disadvantages, so it is important to choose the right one for your business needs.