2020 International Conference on Decision Aid Sciences and Application (DASA)
Logistics strategy (FIFO, FEFO or LSFO) decision
support system for perishable food products
Adriana Mendes João Cruz
Department of Electromechanical Department of Electromechanical
Engineering Engineering
University of Beira Interior University of Beira Interior
Covilhã, Portugal Covilhã, Portugal
adriana.sofia.mendes@ubi.pt j.mendes.cruz@ubi.pt
Tânia M. Lima
C-MAST - Centre for Mechanical and Aerospace Science and
Technologies
Department of Electromechanical Engineering
2020 International Conference on Decision Aid Sciences and Application (DASA) | 978-1-7281-9677-0/20/$31.00 ©2020 IEEE | DOI: 10.1109/DASA51403.2020.9317068
University of Beira Interior
Covilhã, Portugal
tmlima@ubi.pt
Abstract— Food waste is one of the major challenges to be
faced in the world and, therefore, its elimination is one of the
most important issues in the perishable product market. Thus,
it is necessary to develop and/or apply algorithms and
mathematical tools that relate food products perishability with
their cost, i.e, how the value of a product varies as function of its
deterioration over time until spoilage. This decision support
system aims to assist in the product’s price definition during its
shelf life, maximizing the profit and reducing the spoilage and
consequently waste, this means that this system has the objective
to relate sales efficiency and the reduction of losses in perishable
food products, allowing to answer to which logistics strategy
provides a higher profit and consequently less food waste. The
proposed easy and expedite computational decision support
system compares the FIFO, FEFO or LSFO logistics strategies.
The system is tested for two cases of perishable products. First,
the system is explained and tested in detail for the yogurt. The
second product to be considered is the apple, where the results
are briefly presented in order to compare and justify the
proposed method.
Keywords— FIFO, FEFO, LSFO, perishable products, food
waste, decision support system
I. INTRODUCTION
Nowadays, food waste is one of the biggest challenges to
be faced. Worldwide, between 1/4 to 1/3 of the food
produced per year for human consumption, which
corresponds to 1.3 billion tonnes of food, are wasted. The
sustainability of food systems is influenced by the availability
of food, locally and globally, the resources available to
producers and prices for consumers [1].
Perishable foods have a physical state or quality decrease
over time [2]. In practice, 52% of the revenues in the
supermarket chain are made up of perishable products [3] and
in order to maximize the profit from these products, some
supermarket chains reduce the price of the products when
they approach their expiration date.
The objective of this work is the construction of a decision
support system for perishable products, where the user can
select the type of logistics strategy (FIFO, FEFO or LSFO)
XXX-X-XXXX-XXXX-X/XX/$XX.00 ©20XX IEEE
978-1-7281-9677-0/20/$31.00
Authorized licensed use limited to: Robert©2020 IEEE
Gordon University. 173
Downloaded on May 30,2021 at 18:55:45 UTC from IEEE Xplore. Restrictions apply.
Tiago Saraiva
Department of Electromechanical
Engineering
University of Beira Interior
Covilhã, Portugal
tiago.saraiva@ubi.pt
Pedro D. Gaspar
C-MAST - Centre for Mechanical and Aerospace Science and
Technologies
Department of Electromechanical Engineering
University of Beira Interior
Covilhã, Portugal
dinis@ubi.pt
and check which one provides the lowest waste and
consequently the greatest profit.
II. LOGISTICS STRATEGIES
A. FIFO (First In, First Out) strategy
This strategy is the most used in terms of logistics, as it
presents a logical base of thought, i.e., it is based on the date
of entry of product into its place of storage. This concept aims
at the marketing of products that have been in stock for a
longer time to the detriment of those that were later stored,
and excludes the perishability of the product as well as its
destination [4]. The FIFO method can be applied to all types
of products, perishable and non-perishable, food and non-
food, because it does not take into account the deterioration
of the product and the variation in price according to its useful
life.
B. FEFO (First Expired, First Out) strategy
To approach the FEFO strategy, it is necessary to
understand the concept of dynamic life time. According to
[4], the dynamic life time of a product corresponds to the time
interval in which the product is stored (at a certain
temperature) until it reaches the final consumer. It is up to the
consumer to analyze the quality requirements of the product
until he considers it unfit for consumption.
The FEFO strategy can be approached not only in the
search for cost reduction but, can also be used in the search
for a greater logistic efficiency and better product quality
aiming to reach new markets.
Wu et al. [5] developed a mathematical model that
relates the perishability of products to their cost, i.e., it
predicts how the value of a product varies according to its
deterioration over time. The mathematical formulation is
described in Eq. 1.
C. LSFO (Least Shelf - Life, First Out) strategy
The implementation of this strategy is based on the shelf
life of the product. In order to find a solution that answers to
this problem, it is necessary to define as the objective
 2020 International Conference on Decision Aid Sciences and Application (DASA)
function for profit maximization, taking into account that the
shelf life of the product is the main factor to be considered.
Products with shorter shelf life or those whose shelf life is
closer to the end, should be the first to leave the shelf but in
a real situation, this is not always the case. In other words,
normally, consumers tend to move away from products that
are close to the end of their shelf life.
In short, the FIFO strategy will take into account the entry
and in the LSFO strategy, the influencing factor will be the
expiration date, so the operation mode in the decision system
will be similar.
III. DECISION SUPPORT SYSTEM
The developed system aims to help in the decision of the
best strategy to be adopted, FIFO, FEFO or LSFO, in order
to reduce waste and consequently to maximize profit. The
assumptions adopted for the three strategies were the same,
that is, the quantity of products on the shelf in a given period,
the purchase price and the sales price, per unit, and the time
period considered. If the assumptions were not the same, a
comparison between the three methods would be impractical.
And last but not least, it is important to note that, the system
has to be prepared in advance with some data about the
product, such as the average shelf time and its rate of
deterioration.
In Fig.1, the main page of the easy and expedite
computational decision support system is shown. The
computational decision support system was developed in a
spreadsheet structure, namely Microsoft Excel that is widely
used software in small groceries for business accounting. It
should be noted that the user must enter some important
information such as: quantity, expiration date, purchase price
and sale price, corresponding to each week. Still in Fig. 1,
there is a field in green named that "Insert the discount (%)”,
where the user can insert the discount to be applied on the
product when the expiration date approaches, which is only
applicable for the LSFO strategy. It is only applicable for this
strategy because it is common to see in supermarket chains,
when the expiration date starts to approach, the application of
a discount on the product. Finally, the user must enter the
total of outputs and select the intended strategy (FIFO, FEFO
or LSFO).
Fig. 1. Decision Support System
174
Authorized licensed use limited to: Robert Gordon University. Downloaded on May 30,2021 at 18:55:45 UTC from IEEE Xplore. Restrictions apply.
IV. THE CASE STUDY
To integrate the developed decision support system, a
perishable product, yogurt, was selected. The system is
applied to small grocery, more specifically in the yogurt
section for 1 month (4 weeks). In this section is discussed as
topics: the perishable product selected and how the system's
response to it.
A. Product Specifications
According to Vieira et al. [6], yogurt is a semi-solid
product that results from the fermentation of milk. This
phenomenon results from the action of two species of
bacteria, Streptococcus thermophilus e Lactobacillus
dellbrueckii subsp. Bulgarius, and may incorporate other
microorganisms. According to the Codex Alimentarius for
milk and milk products, a yogurt must contain 107 of those
bacteria per gram, that is, 107 (CFU/g).
For a possible implementation, in particular for the
application of the FEFO strategy as part of the decision
support system developed, it is necessary to collect some
data. According to Almeida [7], the average shelf life of
yogurt is 33.5 days. If the yogurts are stored at different
temperatures and with the increase of the refrigeration
temperature, the useful life of the product decreases.
The rate of deterioration is measured as the inverse of the
useful life, so the value of 0.03 (1/33.5) was adopted [7]. The
relative time value when the product does not deteriorate is
given on a 365-day ratio, i.e. "td" is defined as the ratio of the
lifetime to the annual number of days (33.5/365), which is
equal to 0.092 [7].
B. Results for the FIFO strategy
As previously mentioned, the FIFO strategy is defined:
the first purchase that goes in is the first one that comes out
of stock, following its chronological order. The way the FIFO
strategy works is shown in Fig 2. The system variables are:
Q corresponds to the quantity received and the numbers
(1, 2, 3, 4) correspond to the designated week, for example,
Q1 is the quantity of the 1st week.
L is assigned to the profit, for example, L1 corresponds to
the profit earned in the first week.
X is the total target quantity.
 2020 International Conference on Decision Aid Sciences and Application (DASA)

C. Results for the FEFO strategy

After considering all the factors, the FEFO strategy is
shown in Fig.5. This strategy works based on an expression
from the mathematical model in (1) and is adapted to the
needs and conditions of the case study. For this case study, a
replenishment time (T) was considered longer than the time
when the product does not deteriorate (td). There is not
enough data to indicate the maintenance cost (h) or order cost
(A). That said, the new mathematical formulation is shown on
Eq. 2.

(1)

(2)

The variables considered in (2) are the following [5]:

c: the purchasing cost per unit;
p: the selling price per unit;
Q: the order quantity or total target quantity;
Fig. 2. Flowchart for the FIFO strategy.
θ: the deterioration rate;
α: market size;
This strategy works as follow: when the X is less than the
β: Product sensitivity constant to price change;
quantity of the first week (Q1), the system indicates the total
profit, that is, the multiplication of the target quantity by the D: Demand, is time-dependent and is defined as ∗ ;
profit of each unit of the first week (X*L1). Otherwise, it T: The length of the replenishment cycle;
moves to the next week, in which when the total target td: the period of the length of time in which the product
quantity subtracted from the quantity of the first week is less has no deterioration.
than the quantity of the second week (X-Q1 < Q2), the system
indicates the total profit and so on. If there are not enough The results obtained for this strategy and the selected data,
quantities to satisfy the number of outputs, the system the 40 units would give a profit of 10.46 euros, as shown in
indicates the message "Insufficient Inputs". Fig. 3 shows the Fig. 5.
last scenario, where there are only 46 units in total and the
user asks for 50.
The results obtained for the selected strategy and for the
selected data, the 40 units would give a profit of 17.30 euros.
The example of the FIFO strategy is shown in Fig.4.

Fig. 3. Example of application when there are not enough units with the computational decision support system.

175
Authorized licensed use limited to: Robert Gordon University. Downloaded on May 30,2021 at 18:55:45 UTC from IEEE Xplore. Restrictions apply.
 2020 International Conference on Decision Aid Sciences and Application (DASA)

Fig. 6. Assumptions assumed in the system for the LSFO strategy.

Fig. 4. Example of the application of FIFO strategy with the computational decision support system.

Fig. 5. Example of the application of FEFO strategy with the computational decision support system.

D. Results for the LSFO strategy

Later, for the user’s decision making, the same data was
applied to the LSFO strategy, in order to conclude which one
of these strategies will provide the highest profit. The LSFO
strategy works the same way as FIFO, only which instead of
considering the entry date, the system will consider in
ascending order the expiration date. In addition, are
considered a few assumptions, as the discount 35% applied
to the product when the expiration date approaches. In order
to reflect reality, the user always tends to look on the shelf for
the product with the longest expiry date. As a logistics
strategy, the products in the front have a lower expiration date
and consequently, those in the back have a higher expiration
date, and to solve that problem some assumptions were added
to make the system more realistic. These assumptions are
shown in Fig. 6.
The assumptions work as described below: The lot
received in the first week, 50% of the products end on the first
date to expire and the other 50% end on the second date to
expire, i.e. in the first week 10 products were received where
5 ends on 03/09/2020 and another 5 ends on 06/09/2020. In
the second week, there are 12 products, where 40% end on
the first date to expire and 60% end on the fourth date to
expire, i.e., 4 products expire on 03/09/2020 and 8 products
expire 10/09/2020. The same thing happens in the third week,
where there are 10 products on the shelf, where 40% end on
the fourth date to expire (4 products expire on 10/09/2020)
and 60% end on the third date to expire (6 products expire on
09/09/2020). In the last week, 100% of the products on the
shelf expire on the third date (09/09/2020). In summary, after
all the assumptions, Table I shows the quantities and profit
for the 4 weeks for the case study. Fig. 6. Assumptions assumed in the system for the LSFO strategy.

176
Authorized licensed use limited to: Robert Gordon University. Downloaded on May 30,2021 at 18:55:45 UTC from IEEE Xplore. Restrictions apply.
 2020 International Conference on Decision Aid Sciences and Application (DASA)

TABLE I. TOTAL QUANTITY AND PROFIT.
Even if the product (with lower expiration date) is with a
discount, some users prefer the products with a longer date
and pay the price without discount. That said, the profit
obtained is 14.63 euros. The results are shown in Fig. 7.
After an analysis of the values obtained for the total profit,
using the FIFO, FEFO or LSFO strategy, it is possible to
conclude that for this case study the FIFO strategy is the
strategy that enhances a higher profit. In opposite, the FEFO
strategy is the one that provides the least profit in the
considered tie interval.
E. Results for another product – Apple
To check the functionality of the developed system,
another perishable product was chosen. The system continues
to be applied in small grocery, in the fruit section for 1 month
(4 weeks).
The product selected was the apple fruit and according to
Maciel et al. [8], this fruit has a deterioration rate of 0.8 and
a shelf life between 10 and 12 months. To test the product in
the decision support system, the new factors considered were
the rate of deterioration, θ; time that the product does not
deteriorate, td; and 1 unit of apples in the system is counted
as 1 kg.
Fig. 8 shows the desired quantity of apples, the expiry
date, the purchase and selling price. Still in the same figure,
it shows the strategy that will provide the highest profit, in
this case, the FEFO strategy with a total of 53.35 euros. The
FIFO and LSFO strategies follow the same logic as shown in
Fig. 2 and Fig. 6, respectively. As result, the profit for the
FIFO strategy is 47.70 euros and for the LSFO strategy is
45.25 euros.
In the case of apples, the FEFO strategy seems to be the
best approach to apply, since it is the one that provide the
highest profit. In this case, the results obtained take into
account the state of the art, where it was noted that the FEFO
was the best strategy to apply to perishable products.

Fig. 7. Example of the application of FEFO strategy with the computational decision support system.

Fig. 8. Example of the application of FEFO strategy with the computational decision support system applied on apples.

177
Authorized licensed use limited to: Robert Gordon University. Downloaded on May 30,2021 at 18:55:45 UTC from IEEE Xplore. Restrictions apply.
 2020 International Conference on Decision Aid Sciences and Application (DASA)

V. CONCLUSIONS [3] X. Chao, X. Gong, C. Shi, and H. Zhang, “Approximation Algorithms

for Perishable Inventory Systems,” Operations Research, vol. 63, no.
From the analysis of the state of the art can be concluded 3, pp. 585–601, Jun. 2015.
that the FEFO and LSFO strategies appear as the best [4] W. A. Spagnol, V. Silveira Junior, E. Pereira, and N. Guimarães Filho,
solutions in what is portrayed logistics strategies of “Redução de perdas nas cadeias de frutas e hortaliças pela análise da
vida útil dinâmica,” Brazilian Journal of Food Technology, vol. 21,
perishable products. For the yogurt, this is not the case here Feb. 2018.
and there are some explanations for this. One possible cause [5] K.-S. Wu, L.-Y. Ouyang, and C.-T. Yang, “Coordinating replenishent
is that when the FIFO strategy is adopted, is considered that and pricing policies for non-instantaneous deteriorating items with
the consumer always removes the products that have been on price-sensitive demand,” International Journal of Systems Science, vol.
the shelf the longest. From another perspective, it is possible 40, no. 12, pp. 1273–1281, Dec. 2009.
to see that the human factor is present in the LSFO strategy, [6] P. Vieira et al., “A microbiological, physicochemical, and texture study
during storage of yoghurt produced under isostatic pressure,” LWT,
and in order to portray reality, the consumer tends to move vol. 110, pp. 152–157, Aug. 2019.
away from the products that are closer to the expiry date. In [7] D. M. Almeida, “Determinação do tempo de vida de prateleira de
this strategy, the behavior of consumers is a decisive factor in iogurte com de polpa de fruta por meio da população de bactérias
its efficiency, this depends on the case under study (which láticas totais”, Revista Brasileira de Tecnologia Agroindustrial, vol. 9,
no. 1, Jul. 2015
varies from month to month), as the quantities associated with
each expiration date, as well as the discount made by the [8] V. Maciel, C. Matos, T. M. Lima, P. D. Gaspar, and F. C. Santos,
“Decision support system to assign food price rebates on the basis of
seller will be other factors that contribute to different values. quality decline,” presented at the ICEUBI - International Congress on
Regarding the FEFO strategy, it is suitable for perishable Engineering, Covilhã, 2019.
products. Yogurt is a perishable product but has a low rate of
deterioration. This strategy would be more effective for a
larger sample and considering a longer study time.
The system was tested for another perishable product, the
apple, where it was adjusted to its characteristics. The results
obtained with this product confirm the state of the art
described above (FEFO strategy appears as one of the best
solutions for perishable products). The product's
characteristics, such as the deterioration rate and the time the
product does not deteriorate, will influence the final result,
i.e., as seen, for yogurt the best strategy is FIFO and for apple
is FEFO.
However, this decision support system could be changed
to another perishable product, taking into account that it
should be adjusted to the characteristics of the product and
the environment.
As future work, the discount and the sales price can be
calculated automatically, depending on the quality of the
product or the approach to the end of the expiration date.
ACKNOWLEDGMENT
This study is within the activities of project “PrunusPós -
Optimization of processes for the storage, cold conservation,
active and/or intelligent packaging and food quality
traceability in post-harvested fruit products”, project n. º
PDR2020-101-031695, Partnership n.º 87, initiative n.º 175,
promoted by PDR 2020 and co-funded by FEADER within
Portugal 2020.
This work was supported in part by Fundação para a
Ciência e Tecnologia (FCT) and C-MAST- Centre for
Mechanical and Aerospace Science and Technologies, under
project UIDB/00151/2020.
REFERENCES
[1] “Perdas e desperdícios de alimentos na América Latina e no
Caribe”, FAO, www.fao.org, 2014. [Online]. Available:
http://www.fao.org/americas/noticias/ver/pt/c/239394/. [Accessed: 22-
Jul-2020].
[2] M. Shukla and S. Jharkharia, “Agri fresh produce supply chain
management: a state of the art literature review,” International
Journal of Operations & Production Management, vol. 33, no. 2, pp.
114–158, Feb. 2013.

178
Authorized licensed use limited to: Robert Gordon University. Downloaded on May 30,2021 at 18:55:45 UTC from IEEE Xplore. Restrictions apply.