What does FIFO stand for?

FIFO stands for "First in, first out," which is a fundamental inventory management method. This principle dictates that the oldest inventory items are the first to be sold or used, ensuring that products do not spoil or become obsolete. For a restaurant or retail operation like Domino's, applying FIFO helps maintain food safety and quality by reducing the likelihood of expired ingredients being used in meals. This practice also assists in accurate financial reporting since it aligns costs with revenue more closely based on the actual flow of goods. By prioritizing the sale and use of older inventory, businesses can effectively manage their stock levels and minimize waste.