A Fork in The Road: Committing to Food Traceability in 2021

We are standing at the dawn of a trust revolution in the retail sector, in which food traceability becomes a global trend and consumers obtain visibility on the entire food journey. This transformation is compounded by the ever-increasing importance of health, safety and well-being concerns in society – accelerated further by the COVID-19 pandemic. As food traceability transitions to the forefront of the retail sector, without a doubt, there are immense challenges for retailers and suppliers in delivering effective tracing solutions. However, as we saw with the e-commerce transformation, those who adopt new technology and innovate early will significantly increase their potential market leadership in the near future. The question is, how do we implement the changes needed while also supporting our network of supply chain partners, especially in overcoming their hesitation to adopt the new technology and to assist in capturing all the required data accurately and quickly? As retail leaders, we must work with suppliers in overcoming this hesitation to share data publicly and emphasise the advantages of doing so.

More than a high-tech paper trail

The business benefits food traceability are diverse and substantial, from improved operational efficiency and better credibility to timely error prevention and a lower risk of legal issues. Furthermore, food authenticity, provenance, sustainability and security are essential elements in creating stronger bonds between brands and consumers. Evidence to support this transformation is clear; for instance, the IBM Institute for Business Value found that 73 per cent of consumers surveyed indicated traceability of products is important to them. A further 71 per cent of those respondents indicated they are willing to pay a premium for brands that provide it. We are fortunate to live in a time when available options in food traceability include a plethora of innovative software providing enhanced supply chain visibility. These solutions collect, store and trace data to track ingredients and raw materials, and can reduce the time and costs associated with audits or recalls. The most promising new solution, in my opinion, is Blockchain technology. Often applied as part of the solution, Blockchain provides a straightforward platform that allows all suppliers to tell their story by adding various data to the system for all stakeholders to access. However, the most challenging hurdle for retailers in this process is securing every partner’s participation in the supply chain. Success in this regard means retailers can provide consumers with the full narrative, detailing each product’s entire journey to the supermarket shelf.

At present, the lack of full end-to-end traceability across the entire food supply chain is often due to outdated technology and a reluctance to share data. While blockchain technology is new, it has quickly become an obvious choice to replace obsolete systems, using decentralised open-source ledgers stored on a public database that provide verifiable end-to-end visibility. However, transferring processes and procedures from old systems to new ones is inherently difficult to plan and manage, as it requires commitment at every step of the supply chain. This means necessary data must not only be captured and logged in almost real-time, but also crucially, shared.

A problem shared is a problem halved

In recognising the urgency and complexity of the food traceability challenge, and the need to work with experts in the Blockchain and traceability field, Majid Al Futtaim announced a strategic partnership with a global tech company with an established track record to implement the latest tracing technology across Carrefour. Our long-held view that partnerships make all of us stronger is evident in this latest development. Majid Al Futtaim will work hand-in-hand with its supply chain partners to ensure the adoption of blockchain food traceability technology across our entire supply chain. In doing so, Carrefour can efficiently document and locate a product through the various stages in the value chain, including manufacture, processing, distribution and handling. All of which will be instantly accessible to consumers by scanning a QR code with their smartphone device. Since our initial decision to commit to this innovation, our food traceability journey took over 6 months to launch. At present, the initiative now has two initial product categories: Carrefour’s own fresh chicken brand and microgreens harvested from our in-store hydroponic farms, with plans to expand into more product lines in the coming months.

Such a solution sits well within a retailer’s transformation journey to revolutionise business operations to better its performance and satisfy consumers. The rising importance of transparency and traceability in the retail sector creates a remarkable business opportunity for retailers to seek partnerships with technology experts and suppliers to benefit from brand differentiation while building robust customer trust and loyalty. Food traceability has already been adopted internationally by leading names in the sector and actively helps ensure consumer satisfaction while reducing reputational damage and potential financial losses.

Looking ahead to the near future, food traceability will become a primary consumer demand, and they will consciously gravitate towards those retail leaders delivering visibility on the entire food journey. We believe committing to food traceability in 2021 is of great importance to both retail and consumer goods leaders. Now is the time for greater collaboration and more strategic partnerships across every link in the value chain, striving to make a positive difference in the lives of our valued customers.

This blog was written and contributed by:

Chief Executive Officer

Majid Al Futtaim Retail

(Operator of the Carrefour franchise in the Middle East, Africa and Asia)