Why the F & B Industry is Taking
Supply Chain Traceability Seriously

The food and beverage (F&B) industry has been growing rapidly in the last few years. According to the Food and Beverages Global Market Report, the industry is poised to grow at a CAGR of 7% and will be worth $7.6 trillion by 2023.

While the industry has been flourishing, there are growing concerns about the lack of visibility in the food supply chain. This had led to an increase in product recalls, and the insurance claims reached an average of $9.5 million.

Additionally, countries like India, the US, and the EU have stringent regulations to establish transparency in the supply chain. For example, the Food and Drug Administration (FDA) in the US has passed the FSMA act, which has made it easier for the F&B industry to track the movement in the supply chain to prevent food contamination. The EU passed the General Food Law Regulations to trace food at all stages of the supply chain to ensure that it complies with the food safety requirements. Recently, the Government of India, Ministry of Agriculture & Farmers Welfare, Department of Agriculture, and Cooperation and Farmers Welfare issued a notification to add QR codes on the labels to prevent counterfeit products from being distributed in the market.

To ensure compliance with these regulations and promote transparency in the supply chain, the F&B industry worldwide takes traceability solutions seriously. Traceability solution helps them trace the entire product lifecycle – right from the origin of the raw material to the distribution. They can easily track and trace the product in four hours with the help of a traceability solution.

How Does Traceability Help at Different Stages?

Traceability solution helps in tracing the origin of the product and where it got delivered. The F&B companies need to ensure that every data – the ingredients used, the suppliers of raw material, the rejects and waste by-products, steps in manufacturing the product, storage records, batch sheets, and shipping details are recorded correctly. It helps in tracking the products and during third-party audits. It enables the F&B companies to stay compliant and audit-ready. However, F&B companies have to implement traceability solutions at every stage to remain compliant and audit-ready.

Let’s see how traceability helps.

  1. Production: Sometimes, the company may have limited visibility if large quantities of ingredients are used during the production. It’s difficult to identify issues with the ingredients if the tracing is done manually. Food traceability solutions can help the company to monitor the inventory in real-time and quickly identify issues in the production line. This will save their time and reduce the error occurrences.
  2. Packaging: According to the different regulations such as FSMA and India’s Ministry of Agriculture and Farmers welfare, package labels are mandatory. The packages must contain accurate information about the content. The objective is to reduce the sale of counterfeit products and to reduce the number of recalls. Companies can use sensor technology to confirm if the content matches packaging and verify the sell-date and batch code of the product.
  3. Warehouse management: Companies can use traceability solutions to get a complete overview of how the warehouse is managed and get an idea of the movements of the products inwards and outwards. For a long time, companies were using manual processes to generate and scan barcodes for the products that arrive in the warehouse. That led to errors and reduced the productivity of the workers. Companies can improve warehouse operations and save time on data capturing and processing with a barcode printer that generates unique barcodes with information about the product and a hand-held terminal (HHT) that scans the material and updates the information to an online application in real-time.
  4. Dispatch: Traceability solutions can also automate the dispatch of raw materials and finished products to various places. For example, companies can use hand-held terminals to scan the products and send their details to the server. They can further complete the authentication process by validating the details and generate reports whenever required. This helps companies to prevent counterfeit products from entering the supply chain.
  5. Recall: Sometimes, faulty products could creep into the supply chain despite the company’s stringent processes. Traceability solutions can help companies locate faulty products in the supply chain based on their serial number or batch number and recall them before the consumer purchases them. Apart from recovery, traceability solutions also help companies identify where the problem lies and take preventive actions to avoid such issues in the future.

Food fraud costs the F&B industry over $50 billion every year. These frauds include adulteration, misrepresentation, substitution, etc. Hence, traceability has become a necessity. As these frauds get sophisticated, the F&B industry cannot afford to use legacy systems and processes to trace them. They need modernized technologies such as RFID, scanners, QR codes, and sensors to improve supply chain visibility. It will help the F&B industry reduce recalls, accelerate delivery speed, and improve customer satisfaction. However, companies need to ensure that these technologies are seamlessly integrated into their existing processes. They need to work with the right technology partner who would help them with end-to-end traceability solution implementation and improve compliance and product quality.