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Cloud supports supply chain visibility

By Retail Technology | Tuesday March 26 2013

Supply chain automation ID expert Marcel Kars asks if cloud computing can resolve complex traceability challenges facing food manufacturers and retailers

The recent food fraud scandal, which affected a number of supermarkets’ meat-based ready meals, illustrates the dilemma facing food manufacturers as they seek to offset rising costs with the need to operate a sustainable business. 

“Market conditions require quality food for the lowest possible prices, yet this commercial priority needs to be balanced with consumer’s increasing demands for food provenance and safety,” Marcel Kars, sales and marketing vice president at supply chain, identification and mobility technology provider Zetes.

Longer, complex supply chains have been criticised as the problem. They exist because they allow raw materials to be sourced for the best possible prices within a pan-European network of suppliers and traders. However, Kars said this practice should not compromise food quality or safety levels for the consumer. “Rather than criticise the length of the supply chain, perhaps it would be more useful to identify solutions to enable real-time access to business-critical product information in their supply chain operations,” he suggested. For example, cloud based track and trace solutions, linked to secure, item level product identification based on 2D Datamatrix barcodes or radio frequency identification (RFID) tags, could provide visibility of product and ingredient provenance.   

Sharing the IT cost of responsibility 

By taking advantage of cloud technologies, Kars argued that traceability systems can become collaborative without the need for different stakeholders to implement any extra, costly IT infrastructure. “This means different partners across any length of supply chain can store product information virtually and track the movement of objects along the supply chain, creating a secure, real-time data repository of traceability information – from manufacturing, packaging, logistics and transportation right to the retail store,” he explained. 

Acting as a unified repository of data records, such a system can interface with different sources of information including item IDs, logical links and events, both within the entire enterprise and beyond its four walls. He continued: “An approach like this scales easily and would work well for complex non-integrated IT environments where information is held within silos and as well as a complex supply chain environment, spanning multiple sites, business units and stakeholders.

“If suppliers, sub-suppliers and trading partners were obliged to store information relating to their raw ingredient sources and record product movements across the supply chain, retailers selling own branded goods could reduce food fraud in their own supply chains. This is because individual companies involved would be more accountable and easily identifiable. In turn, this would improve levels of security within the supply chain and build greater trust between the different partners.” 

Virtual collaboration among suppliers

By storing information virtually in the cloud, raw ingredients, finished goods, logistics units and returnable assets can be tracked all the way along even the most complex supply chains, literally from source to fork. In addition, in the event of a recall, finished goods can be uniquely identified using techniques now widespread in the pharmaceutical industry, with serialised Datamatrix labels. Kars said this prevents poor visibility and improves the accuracy of supply chain operations. “For high margin, competitive environments, for instance, retailers selling designer goods or premium foods, it also limits the threat of grey market activity or trade in counterfeit goods,” he added. “Recalls can be managed more easily with less wastage because shelves can be cleared of exactly the affected stocks, rather than having to take a blanket approach.” 

There is no doubt that food supply chains have become more complicated and longer. When it comes to food retailers, Kars said they also need to effect change within the industry to protect themselves and consumers from fraud. “Ultimately, if a supplier intentionally mislabels ingredients there is little that can be done to prevent the practice,” the supply chain expert conceded. “However, what a manufacturer or retailer can do is insist that suppliers record the origins and movement of all products within the manufacturing chain and improve levels of transparency. 

“Holding data securely within a collaborative, cloud-based repository, makes it possible for a manufacturer to work with independent partners to quickly retrieve very specific, item level product information. In doing so, the resulting improved traceability will enable improved product quality and safety, control grey imports and eliminate counterfeiting – ultimately protecting brand reputation and minimising the frequency of product recalls for consumers, manufacturers and retailers,” he concluded.

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