1. Being able to precisely locate potentially harmful products through supply chain visibility. Perhaps the most critical piece of traceability is supply chain visibility. By breaking down the barriers that come with using proprietary systems, food industry trading partners benefit from the common language of standards by gaining unprecedented visibility into their supply chains. Companies can achieve internal process improvements, but the most important element of supply chain visibility is the ability to accurately and quickly pinpoint a potentially harmful product.
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Explore This IssueJune/July 2015
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Implementing supply chain visibility shows a strong commitment to traceability and that a company is taking a proactive approach instead of simply reacting to a specific event. Recalls or withdrawals are caused by various reasons—undeclared allergens, foodborne illness, cross-contamination, or particles from equipment ending up in the final product. With enhanced traceability procedures, businesses can prepare for emergencies and avoid the damage a widespread recall can inflict for months or even years afterward. Even if a company has never been linked to a food safety emergency before, standards-based traceability practices provide customers reassurance and contribute to an optimal crisis management plan.
2. Ensuring trustworthy product information and data quality. When the GS1 US Retail Grocery Initiative launched in mid-2014, a major discussion point among retailers, suppliers, and other industry stakeholders was the need for improved product information and images online. By bringing together industry leaders from grocery, fresh foods, and consumer packaged goods, the Retail Grocery Initiative identifies specific industry challenges and develops potential solutions to continue the progress toward more efficiencies, enhanced risk management, and business growth.
Right now, the state of product data is inconsistent and the need to provide trustworthy information to consumers scanning a product barcode or searching for a product online is one of the top challenges the industry will tackle in 2015.
The diversity of requests for sharing product information and images with trading partners, consumers, and regulators has created a challenging landscape where a large number of suppliers are also aiming to meet various demands in other industry verticals (such as food service). With online grocery shopping on the rise, the urgency is only intensifying. Looking at the entire retail industry, grocery leads in sales via mobile devices, according to PricewaterhouseCoopers. Its data shows mobile accounted for 37 percent of grocery e-commerce sales last October and outpaced such industries as furniture, health and beauty, apparel, and electronics. The online grocery market is expected to grow at a rate of 21 percent annually through 2018, according to BI Intelligence.
3. Reducing food waste. More than 50 million Americans struggle to put food on the table, according to the Institute for America’s Health. Yet, as a country, we also throw out roughly 35 million tons of food, according to the Environmental Protection Agency. In the face of these imbalanced statistics, there is tremendous pressure placed on the food industry, especially fresh foods where products are more prone to spoilage, to reduce waste. The traceability processes based on GS1 Standards can provide a solid operational foundation to facilitate less food waste.
Adopting standards-based traceability procedures—or expanding upon the ones already in place—will lead to more precise inventory planning and category management. GS1 Standards encompass many different types of barcodes that are used based on industry needs. Specific barcodes such as the GS1-128 for cases and the GS1 DataBar for individual items allow for dynamic information (such as batch/lot numbers and “use by” dates) along with the globally unique product identification.
A standards-based approach facilitates a more effective “first in, first out” inventory management philosophy. Retailers can more efficiently manage automatic price markdowns as expiration dates grow near, and prevent expired food from being sold at the point-of-sale. In the event of a recall, instead of wiping out the entire product from retail shelves, standards-based traceability procedures allow for a more specific isolation of the affected product, better identifying the product not affected and available for consumption.