Current Issues in Food traceability
Today there are many options to ensure traceability along a food supply chain and to protect manufacturers and consumers against fraud and physical harm, using NFC, RFID or Barcode based approaches, but despite all these approaches, the core problem is still the same than in the past with the traditional paper-based traceability systems - you have to create a gap-free paper trail. If there are gaps in this paper trail, no matter if in digital or still paper form, things can get very messy when it comes to incidents like a product recall. You can still use biological methods, like gel electrophoresis or the stable isotope method to get a rough idea about where ingredients may have been delivered from, but it will still be difficult to find out the exact company or person responsible for the mistake or fraud in the supply chain.
In addition, current traceability and connected Quality management data are often just stored in separate databases and are therefore often not able to get regularly checked and validated by other stakeholders in the supply chain. That’s why companies still have to put much effort into regular audits on their own or via third parties to check if quality criteria are met and the traceability system is fully functioning.
Current Blockchain ventures are now promising that a blockchain based traceability system can provide a gap-free traceability system, which can also reduce the necessity of third parties involved as the traceability and quality management information, stored in the blockchain are observable for everyone and get constantly validated by a certain party in the blockchain or supply chain network. In addition, the data can’t be changed anymore once it got implemented into the blockchain after the validation process. Furthermore, the information gets also saved together with a timestamp into the blockchain, which adds another level of security to it, but also give manufacturers additional information where the product or ingredient is or was at a certain point in the supply chain.
If this technology keeps the promises, it can probably take traceability to a whole new level and companies like Walmart or Nestlé are already working together with IBM on implementation possibilities of the blockchain approach into their existing traceability and quality management systems.
We also believe that the blockchain will be a standard to ensure traceability in the future, but it will still take a couple of years till small companies in the supply chain will be able to afford the implementation of automated blockchain systems into their current IT setup.
The blockchain solutions of today are still often specialised applications, which got programmed for individual companies or purposes, which makes them often not reusable for other companies and very expensive. So we believe that till there isn’t an easy to implement and affordable Software or Software-add ons to existing ERP and Warehouse management systems, there will be not a big transition away from the slower, more prone to error, but still functioning systems. In addition, there is till now no external pressure forcing companies to move away from the current systems and if you want to switch to a blockchain based traceability model everyone in your supply chain should use the blockchain approach to have a consistent set of data. If one partner in the supply chain doesn’t jump on the blockchain train, the whole approach doesn’t make more sense than probably traditional traceability systems. Nestlé and Walmart could have probably enough market power to convince all their suppliers, as well as production and logistics partners to adapt the system, but for smaller companies, it will still be difficult to convince their supply chain partners to pull in the same direction. So probably it will be the big players first moving onto the blockchain and not a grass root movement. We are excited to see what will happen in the future and maybe there are despite our perception small startups able to come with an easy-to-use, replicable and cost-efficient solution.