What are food and beverage products made of, and how are they made? Where are the ingredients sourced from? How were they grown? How do groceries reach the shelves where people buy them from? These are questions that not many would have bothered asking some years ago, but have become a main point of concern for consumers today. And if consumers care about these aspects, food and beverage companies have no choice but to care about them as well.
Until not so long ago, success in the food and beverage industry was largely the result of a combination of quality, value for money, convenience, and effective marketing. People were mostly interested in price and how good the products were (mostly how they tasted) when weighing their options, but now their attention turns elsewhere as their priorities seem to have changed quite a bit.
That’s not to say that these aspects don’t matter anymore. They do, but the demand for transparency and traceability has taken centre stage in recent years as people have been losing trust in food systems, and they’ve also grown more aware of sustainability issues as well as more interested in health and wellness, especially after the Covid-19 pandemic.
The faults in our food and beverage systems
There are many flaws and shortcomings in the way food and beverage systems operate currently. Probably one of the most concerning aspects right now is the large amount of food that goes to waste globally, which, by the latest estimations, amounts to over 1 billion tons a year, causing the global economy to lose approximately $1 trillion. Food waste also contributes significantly to global greenhouse gas emissions, accounting for 8-10% of the amount registered annually. Although households seem to be the biggest culprits in the food waste crisis, being responsible for 60% of it, food services and retail are also at fault.
In the beverage industry, regulations regarding alcoholic beverages are becoming more stringent, with rules around the production, distribution, and sale of such products getting tighter in many countries, so the logistics are also getting more complex.
Many of these issues offer some food for thought and are, in one way or another, related to supply chains and how they function, which is why transparency and traceability have become so important today.
Ensuring the safety and quality of products
Safety is crucial in the food industry, with all parties involved in production and distribution processes being required to follow very strict rules and standards meant to ensure that the products they bring to the market are appropriate for human consumption. Hygiene is extremely important in this respect, as everyone from food manufacturers to restaurants and retailers has to adhere to rigorous sanitation guidelines, so that contamination risks are systematically eliminated.
By making traceability a priority, food and beverage companies can stay on top of these requirements and monitor the quality of the foods they produce and serve to consumers all across the supply chain. That means they can spot potential issues more effectively and intervene promptly to isolate and prevent them from spreading and reaching more consumers. In case something happens and a product recall is necessary, traceability solutions allow for easy and precise identification of the products that might pose a danger to consumers and their swift withdrawal, so companies can contain the risks and limit both financial losses and reputational damage.
Alignment with sustainability requirements
Given that the food and beverage industry is known for having a considerable environmental footprint, companies in the sector have no choice but to reconsider their practices and adopt measures that could help them operate in a more sustainable manner. Studies have shown that many people would be willing to pay more for food items that are produced responsibly and have a low impact on the environment.
Transparency and traceability play a key role in transitioning to more eco-friendly practices, especially when it comes to ingredient sourcing. For instance, being able to verify suppliers’ activities can ensure that the cocoa powder used in chocolate products is sourced ethically, which is extremely important for addressing issues such as deforestation, climate change, and abusive labour practices.
Compliance, authenticity, and accountability
In many countries around the globe, traceability in the food and beverage industry is not just a practical solution that companies can employ if they want to, but a legal requirement enforced by relevant regulatory bodies. By keeping a detailed record of how ingredients and products move throughout the supply chain, businesses in the sector can demonstrate that their activities conform to applicable regulations and therefore avoid the hefty fines and legal penalties that regulators impose for non-compliance.
The risk of food and beverage fraud is another legal aspect that traceability can address. Advanced tech solutions make it possible to create digital twins for each item and product, so they can be tracked from source to shelf, which guarantees their authenticity and ensures accountability for all the parts of the supply chain.
Winning consumers’ attention and trust
Competition in the food and beverage sector has always been quite intense, and things have been getting even more complicated lately as the industry is facing new pressures and consumers’ needs are changing faster than ever before. Companies that know how to approach customers and give them what they expect are the ones that will rise above the rest, and right now, what customers seem to focus most on is transparency. People expect food and beverage manufacturers to be transparent about how their products are made and what they are made of.
Let’s take chocolate as an example, since it’s one of the most popular food products in the world. Chocolate brands are intensely scrutinized by consumers who want to know what goes on behind the scenes, which requires transparency at all levels of the supply chain, from the cocoa powder supplier they purchase the raw ingredients from and the farms where the beans are grown to the production practices they use. Companies that are honest and provide detailed information in this respect are generally seen as more trustworthy and tend to attract more customers.
