inventory management

Understanding the Basics of Batch Tracking in Inventory Management

We discuss the pros and cons of batch tracking for small manufacturers.

Inventory management is an essential part of any business operation, regardless of its size and niche. From managing stocks and products to ensuring constant supply, not having a reliable inventory system can lead to losses and inefficiencies.

One integral aspect of inventory management is batch tracking, which ensures that businesses can keep track of the specific batch of products they have in stock at any given time.

In this blog post, we’ll dive deep into what batch tracking is, its importance, and how businesses can use it to streamline their inventory management systems.

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What is batch tracking?

Batch tracking refers to the process of tracking a group of items or goods that were produced at the same time, by the same manufacturer or supplier, and have similar characteristics or components.

Usually, a batch is marked with an identifying number, date, and other identifying features to make it easy to track down the specific items when needed.

Batch or lot tracking: what’s the difference?

Lot tracking is very similar to batch tracking in that it involves keeping track of a group of items that share the same production information.

However the key difference is that lot tracking is often used for perishable goods or products with expiration dates, while batch tracking can be used for any type of product.

Read more: Lot Numbers: The Complete Guide

Why is batch tracking important?

Let’s step back a bit and discuss why batch tracking is important in inventory management.

Reason 1 : Lot tracking allows you to improve the quality of your products.

By tracking individual batches of products, you can easily identify and isolate any faulty or defective items. This allows businesses to take corrective measures before the entire batch is sold, reducing the risk of customer complaints and product recalls.

For instance, if a business discovers that a batch of products has a quality concern, it can easily trace those items throughout the supply chain and take appropriate measures, such as pulling all affected products from shelves, stopping production, or recalling the items altogether.

Let’s consider an example from a soapmaker called “Bubbly Soaps Inc.”. This company employs batch tracking for their inventory management. During a routine quality check, it was discovered that a specific batch of Lavender Bliss soap bars displayed a discoloration not aligned with the company’s stringent quality standards.

With the batch number, ‘LB2421’, they were able to quickly identify and trace this batch throughout their supply chain. They found all the Lavender Bliss soap bars produced within the same batch, traced them to the retail outlets they were delivered to, and initiated a recall.

Thanks to batch tracking, Bubbly Soaps Inc. was able to promptly address the issue, ensuring that their reputation for high quality products remained intact. They also used the batch tracking information to identify the raw material supplier and production date, helping them trace back and identify the cause of the discoloration problem.

Reason 2 - Batch tracking helps businesses keep track of expiration dates or shelf life.

Some products, such as medicine, cosmetics, and food, are perishable and have a limited shelf life. By using batch tracking, companies can ensure that these items are appropriately managed to reduce waste, prevent spoilage, and ensure customer satisfaction and safety.

For instance, a food processing company can use batch tracking to monitor the shelf life of different food items. If a batch of fruits is set to expire in two weeks, the company can prioritize distributing and selling these items over newer batches. This strategy minimizes waste and prevents selling expired products, which can pose health risks to consumers and negatively impact the company’s reputation.

Moreover, in the case of a reported foodborne illness, batch tracking can quickly identify the affected batch, preventing further distribution and consumption. This level of traceability, facilitated by batch tracking, not only ensures the quality of products but also bolsters consumer confidence in the company’s commitment to safety and quality.

Reason 3 : Batch tracking enables you to maintain regulatory compliance.

For industries like pharmaceuticals, food and beverage, and cosmetics, batch tracking is crucial for maintaining compliance with regulatory requirements. These industries are heavily regulated, and batch tracking is a necessary part of their quality control processes.

For example, in the pharmaceutical industry, batch tracking is crucial for ensuring that only approved drugs are distributed and sold. By keeping track of each batch’s production information and distribution, companies can easily trace back any issues or defects to the specific batch, quickly taking corrective measures and avoiding costly recalls or legal consequences.

Similarly, the food and beverage industry must comply with strict regulations to ensure food safety and quality. By using batch tracking, companies can accurately monitor and report on their products’ production process, ingredients used, and distribution information. This level of transparency is necessary for maintaining compliance with regulatory bodies such as the FDA.

Read more:

How do businesses implement batch tracking?

Batch tracking starts with identifying each batch as it is either received or manufactured by the business, either through a manual system or software.

For raw materials or resale products, a batch number is assigned when it is received, and all other details such as the supplier’s name, the production date, and the product specifications, are recorded alongside it.

For manufactured products, a batch number is usually assigned when production is complete. Additional information such as production time, staff member, materials used and location is usually stored alongside the batch number in a tracking system. Businesses can implement batch tracking in various ways, depending on their industry, inventory type, and scale of operation. Some businesses may use barcodes or QR codes to track batches, while others may use complex RFID technology to track processes throughout the supply chain - it all depends on your team’s internal capabilities and access to technology.

Excel batch tracking is also a common method businesses use, especially small ones, which can be done using simple spreadsheets. However, as the business grows and its inventory management needs become more complex, investing in specialized software or systems may be necessary to streamline batch-tracking processes.

Craftybase is a leading batch tracking software that is specifically designed to streamline inventory management processes for DTC manufacturers. It provides a simple yet effective solution for businesses to manage and track their inventory batches, ensuring that all stock levels, production details, and supplier information are up to date and accessible at all times. Try Craftybase and experience the benefits of efficient batch tracking firsthand. Try us for free today!

Batch Tracking FAQs

Can I use best-by dates for batch tracking?

Yes, best by dates can be used for batch tracking. These dates indicate the estimated time frame in which a product is at its best quality or flavor. This information can be useful in identifying and tracking specific batches of products in inventory management systems.

How can I track the lifecycle of my batch records?

Tracking the lifecycle of batch records involves keeping a record of every change that occurs to the batch, from production to distribution and sales. This process can be done manually or using specialized software, as we have discussed earlier in this article.

Some common methods for tracking batch records include:

Maintaining physical files with all relevant information and updates on each batch Using electronic batch records (EBRs) to digitally track and manage batches Utilizing batch tracking software (like Craftybase) to automate the process and keep all data centralized and accessible.

How is tracking the costs for each individual product or batch useful?

Tracking the costs for each individual product or batch is crucial for businesses as it helps them gain insights into their profit margins, production costs, and overall financial performance. By accurately tracking the costs of each batch, businesses can make data-driven decisions such as pricing strategies, identifying cost-saving opportunities, and evaluating the profitability of specific products or batches.

In addition to this, tracking costs also allows businesses to monitor the overall efficiency of their operations and identify any areas where costs can be reduced or optimized. This not only helps improve profitability but also ensures that products are priced competitively in the market.


Batch tracking is an essential component of inventory management, particularly for businesses looking to maintain quality control, improve compliance, and minimize the risk of losses and inefficiencies. Business owners who implement batch tracking can increase transparency, reduce waste, and ensure customer satisfaction, leading to higher sales and brand loyalty. In summary, businesses should consider implementing batch tracking as part of their inventory management system, whether with a manual or software-based system. By doing so, they can ensure that their products are always in good condition, their processes are efficient, and their customers are satisfied.

Nicole Pascoe Nicole Pascoe - Profile

Written by Nicole Pascoe

Nicole is the co-founder of Craftybase, inventory and manufacturing software designed for small manufacturers. She has been working with, and writing articles for, small manufacturing businesses for the last 12 years. Her passion is to help makers to become more successful with their online endeavors by empowering them with the knowledge they need to take their business to the next level.