Shortly after the 2020 GFSI Conference ended, the world was transformed by the COVID-19 pandemic. While the food supply chain faces unprecedented demand and very little certainty, its role has never been more crucial in getting people all over the world the goods they need.
While it’s currently impossible to know the permanent effects of the COVID-19 outbreak, the food industry must remain focused on protecting our supply chains and enhancing their efficiency to keep products moving with as much transparency as possible.
At the special GS1 breakfast session during the GFSI Conference in February, expert panelists from the retail grocery and foodservice sectors dove into an interactive discussion about then-current challenges and opportunities associated with food traceability programmes. The following themes dominated the discussion in February, but also ring true as the coronavirus crisis continues to have an impact.
Data quality to make informed decisions
Larry Kohl, Vice President of Quality Assurance at Retail Business Services LLC, an Ahold Delhaize USA company, emphasised the role of data, not only to help make the supply chain function faster and more efficiently, but also to make more of a direct connection with the consumer. For example, in the grocery business, there are recalls almost every week. The ability to rely on data to make recalls more precise is essential, so that there is as little impact on the consumer as possible.
Jorge Hernandez, Vice President of Quality Assurance at The Wendy’s Company, echoed the concern for increased data accuracy. From a foodservice operator’s perspective, they are often making big decisions based on data every day — for instance, what is the best course of action when they determine that a temperature sensitive product reached improper temperatures during transport and needs to be recovered. While much has been said about “big” data, the accuracy of the data is critically important to adapt and manage through any supply chain issues.
The panel agreed that now is the time to create a better understanding across the supply chain of the importance of collaboration, since all trading partners may not be prioritising data quality in a similar way. Adopting and using GS1 Standards can ensure everyone has access to accurate data. Not only does this drive food freshness every day, but standardised data becomes especially critical for emergency situations, like a major recall, where communication errors are costly.
Learning from other industries
Digital transformation is also a key driver of food traceability; however, many companies have realised that in order to adopt promising technology, such as blockchain, they first need a foundation based on GS1 Standards to achieve supply chain visibility. With standardised and unique product identification in place, products can be more easily traced and removed from the supply chain before they cause harm to the public at large.
Bob Wolpert, Chief Strategy and Innovation Officer at Golden State Foods said that digital transformation in the food industry is lagging far behind other industries, such as aerospace, where tracing a product component is rather commonplace. Once the industry better aligns around standards and the common goal of food safety, digital technology will help everyone “catch up,” he said.
Additionally, Mr. Wolpert discussed the use of RFID tags in the food industry, and noted that the apparel industry, where inventory accuracy has been greatly improved by the use of RFID at the item level, has offered key learnings. Early RFID testing in foodservice has shown that applying tags at the case level has yielded greater efficiencies due to a reduction in labour spent on manual cycle counts, reduced waste due to automated rotation alerts and actionable insights that come from greater end-to-end visibility. This is promising for the evolution of food traceability and can be combined with temperature monitoring along the supply chain to support food safety.
Ramping Up Online Capabilities
Mr. Kohl also noted the growth of e-commerce has had a profound impact on the grocery industry and continues to only further reinforce the importance of data to fully drive an omnichannel retailer. Additionally, he predicted an increased use of enhanced data carriers such as QR codes in the future that will be applied at the item level to forge more of a direct connection with the consumer. Online interactions will be key to alerting consumers of food safety warnings and extending additional information about the product. Recent research from GS1 US supports this. A study published in March titled “Powering the Future of Retail” revealed that 82% of retailers and 92% of brand owners support transitioning away from the U.P.C. barcode to a two-dimensional barcode (such as a QR code), which can hold more information such as batch/lot numbers, allergens, and product sourcing to respond to consumer demands for transparency.
Ultimately, the panel agreed the industry is better off today than it was 10 years ago, but full traceability continues to be a challenging journey. This theme will be increasingly important to keep in mind in the months ahead. While different sectors are impacted by coronavirus in different ways, the industry will uncover more issues associated with supply chain visibility. As Mr. Hernandez noted, there are a number of drivers for enhanced traceability — the daily business needs for supply chain transparency, regulatory agencies, trading partners, and mainly, consumers. As a whole, the consumer remains the focus of all three panelists’ businesses. Starting small with standards adoption can lead to incremental wins, leading to better supported resiliency and long term consumer loyalty.
To learn more about GS1 Standards, please visit www.gs1us.org.
This post was written and contributed by:
Vice President of Community Engagement