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Today’s consumer demands more information than ever, yet the concept of supply chain transparency was virtually unknown 15 years ago. The reputational cost of failing to meet demands for supply chain-related information about ingredients, food fraud, sustainability, and ethical practices can be high. But, when it comes down to it, there are so many moving parts to the story it can be difficult for companies to know what is happening upstream and to communicate this knowledge both internally and externally.
If you’re in the business of food and haven’t considered a better way to build a bridge between your production and your destined consumer, there’s no time like the present. That means finding effective solutions that support you to showcase the care you put into your agri-food business, including building a reputable brand, backed up with transparency and trust.
According to Emergen Research in Surrey B.C., the global food traceability market already reached $4.5 billion in 2020 and is growing fast in response to the increasing need for identifying necessary documentation, improving quality control systems, and reducing the risks of contaminated products reaching the end consumers.
Central to this work are safety, quality, sustainability, and especially, trust. That means holding the power to link your food chain records, and eliminate inaccuracies and errors while avoiding delays in locating and sharing all that essential data in real-time on-demand.
Why is transparency important?
So, why is there no time like now to focus on building that trust? To start, here are three big wins when your supply chain management software proves that you care.
Customer is key. Your supply chain management software helps you provide key information on your products as they make their way along the supply chain journey. Consumers value information such as, what was the journey from the farm to the store? Are the ingredients, and the packaging, put together with environmental sustainability in mind? What about the ethics behind its production, including the way laborers are treated and compensated? Researchers at the MIT Sloan School of Management found that consumers may be willing to pay 2% to 10% more for products from companies that provide greater supply chain transparency.
Business is better. If you’re supplying food to large multinational corporations, they already understand the priorities their customers take to heart. But do you meet those expectations too, and can you back up those claims? If you’re working with the right supply chain management software, you can have confidence in your claims. Furthermore, implementing automated systems cuts costly errors and, most importantly, ensures you retain the key relationships you’ve worked hard to establish. A lack of supply chain transparency can halt business operations immediately, for example, shipments missing origin documents can be held up and turned away at ports, causing costly disruptions that ripple through the supply chain.
Build your industry. Let’s face it, bad news travels fastest. But, when you tell your good news story and can prove it through accurate supply chain management software that makes it easy to convey, you raise the entire industry. Why not share your progress and facilitate international trade by taking domestically produced food to markets outside your region, creating an even greater demand for it?
A transparent supply chain can prove to consumers that they are purchasing and consuming a product that meets its claims and standards. This in turn will reduce reputational risk and enhance trust in a business. There are important operational benefits too, gathering detailed information on your supply chain performance will help you to identify opportunities for improvement, increasing efficiency and speed, while reducing costly disruptions.
Kraft et al (2018) Supply Chain Visibility and Social Responsibility: Investigating Consumers’ Behaviors and Motives; emergenresearch.com/industry-report/food-traceability-market