GFC

We're not sure there is a more timely or overwhelming topic for our sector then food safety and social responsibility. In fact, at the recent Seafood Choices Sustainability Summit in Paris, it was screaming clear that institutional buyers and their consumers are asking hard questions about the entire life cycle of the product.     Sitting next to Andrew Furner of Trace Register, we watched buyers repeatedly address their strategic plans.    It was clear they were mobilizing with policies that were no longer a one-issue solution.   They were developing comprehensive solutions that were data driven.      I was curious to know what Trace Register brought to the marketplace to meet an ever growing list of must have's.  Here is a Q/A with Andrew Furner, VP of Trace Register, an international tracing solutions company.

Editors Note:  Thanks to Andrew for taking the time to answer all of our questions that could not be more timely. We encourage our readers to read the entire article and reach out for more information on this topic.    We will do our best to publish more here.  Don't forget there is a comments section at the end of the article and we would appreciate hearing from you.

Question and Answers With Andrew Furner, VP, Trace Register

CI:   Andrew, we're hearing more each day about the need for tracking and tracing in the food and beverage systems.    Can you explain what the difference is in tracking systems versus tracing systems?

Andrew: Simply put tracking and tracing are two sides of the same traceability coin. Any good traceability system should be able to do both functions well.

Tracing or Trace Back is the act of following the product back to its source. This is typically a requirement in the event of a problem with the product. We need to find out the “life history” of the product so we can figure out what caused the problem.  It is also becoming more and more important for sustainability or corporate social responsibility programs. In this case the ability to show where the product has come from is a key element to supporting the claims you are making about your product, e.g. did it really come from a sustainably managed source or a producer that meets fair labor practices requirements.

Tracking or Track Forward is typically undertaken after a trace back. Once you have uncovered the source of a problem with a product you then need to find all the other products in that production run that may have the same problem. The track forward starts at the point of problem and identifies where are products from the same batch have ended up.

Simply said.  Tracing goes backwards through the supply chain and tracking goes forward.   

CI:  What is the value proposition of a tracing system, like Trace Register, to the commercial buyer of food or beverage?    In other words, besides just being responsible, does it make or save money for the commercial buyer and if so, how?

Andrew:  Often the first reason our customers are interested in Trace Register is for risk management. They want to know more about the products they get from their suppliers because they are getting asked tough questions by their customers, regulators and, in the case of sustainability and social responsibility, activist non-government organizations (NGOs) like Greenpeace.  They also want to be able to react very quickly in the event of a problem – they want to see at the press of a button information from their entire supply chain back to the source. This speed of response enables the commercial buyer to be seen to be in control because they can proactively manage the problem rather than reactively trying to figure out what went wrong. This can be hugely valuable in protecting and even enhancing the buyer’s brand.

In the event of a product recall a good end-to-end traceability system has the potential to limit the financial impact by precisely targeting what product needs to be pulled from the shelves. Most recalls today end up with a lot of “innocent” product being pulled just in case due to lack of information and certainty. This is expensive to everyone – the buyer loses potential sales, the supplier carries the cost of returned product.

Although we do not position the Trace Register system as a supply chain optimization system I think there is a lot of potential for a system like ours to help drive efficiency through the supply chain. We can carry a lot of useful information about how product moves through every step of the supply chain and this information can be analyzed by supply chain partners to address problems or improve efficiency.

As a simple step in this direction we see a number of commercial buyers who are using our system to standardize the communications they have with their suppliers. Instead of trading emails, faxes, spreadsheets, etc in different formats with each supplier they use the Trace Register system as the communication forum for key information about each shipment. This helps simplify and make more efficient the business communications between supply chain partners – the communication is standardized and in one location. They are also looking to see if having access to the Trace Register system could make their supplier audit and inspection process more efficient by enabling more desk based pre-work and reducing the required on site time required. This could be a saving for both the commercial buyer and their suppliers who often pay the cost of an audit/inspection.     

Finally, we also have a lot of customers who are very interested in using traceability information to enhance their branding and marketing.  They are keen to tell the consumer the “life story” of how the product has been produced and where it has come from. Traceability reinforces the credibility of this story because it is specific rather than generic - it links the story to the actual product in the consumer’s hand. A good example of this is the work we are doing with Kwik’Pak and their website www.kptrace.com. At the web site you can enter the product code of the product you have in your hand and access a lot of information about the product. If you enter the dummy code T01-101095 you can see how this works. I expect to see a lot more of this type of branding and marketing based on traceability in the future.

CI:  Ok and how about suppliers?     What's their value proposition and do you see cases where it makes or saves money for the supplier?

Andrew:  In many ways the value proposition for the suppliers is similar to that for the commercial buyers. It can save them time and cost in the event of a product problem or recall. Liberty International, a leading global insurance company, recognizes this benefit and will offer discounted product recall insurance to seafood companies using the Trace Register system.

Like for the Commercial Buyer, end-to-end, electronic supply chain traceability can also potentially help improve the efficiencies of a supplier’s supply chain. They can gather the information from the entire supply chain to address bottlenecks or identify improvement opportunities.     

For those suppliers that want to promote their own brands or communicate directly with the end consumer traceability for branding and marketing can be very powerful.

We also see a number of suppliers using transparent traceability as a way of strengthening and widening the relationship they have with their customers. Offering to share openly with your customers key product information that can help their safety and quality, corporate social responsibility, and branding and marketing programs is a great way to strengthen a strategic relationship and set you apart from less “open” competitors.

CI:   I have seen Alaska seafood product in markets throughout the world over several decades, but I wonder if it is actually of Alaska origin or if the name is just being harvested for premium prices.        Have you ever seen this and what can we do about making sure consumers are getting the genuine Alaska product? 

Andrew: I have never seen this myself but I have seen lots of reports of seafood product being mislabeled. Some reports I have seen suggest that over 40% of seafood may not be what we think it is. We have even seen reports of school kids buying seafood products and sending it for genetic testing and finding it is not what the label said.  Funnily enough it is always seems to be a cheaper product mislabeled as a more expensive, premium product! I am sure this is always accidental and non-intentional! 

The best way to ensure that you are getting genuine Alaska product is to enable transparent traceability through the entire supply chain and give the consumer the ability to verify this.

A good example of this is one I mentioned before - the work we are doing with Kwik’Pak. They provide premium Yukon River Salmon and have implemented the Trace Register system to ensure that the salmon you buy is really Yukon River Salmon. They have a web site at www.kptrace.com where you can enter the product code and confirm that the product in your hand is legitimate.

Not only is this a great way to reassure your customer that they are actually getting legitimate product it is also a fantastic opportunity for branding and marketing – you can tell the customer the story of the product and what makes it unique.

CI:    There is a lot of discussion in Washington DC right now about upgrading our food safety systems with much discussion about requiring better tracking and tracing systems.       Where do you see this going in the next couple of years?              

Andrew: You are right! There is a lot of focus from the President and in Congress on food safety and how it can be improved. Both the food safety bills currently working their way through the house and senate have requirements for enhanced traceability including traceability systems. Also improving food safety does seem to be a bipartisan topic so I am expecting enhanced food safety to be passed into law under this administration.  I also expect that whatever bill comes out will not be prescriptive, meaning it will layout the general framework for traceability including the need for electronic systems but leave it up to the market to figure out the best solutions to meet this requirement.  

The FDA is also paying a lot of attention to traceability and it has recently received the results of a couple of consulting studies it commissioned to look at what is needed for traceability in the food industry. Key recommendations of these reports were the need for end-to-end supply chain traceability and the use of electronic systems. It would not surprise me to see them start to apply some of these recommendations in their day-to-day working procedures.

Even without legislation I get the impression that industry itself is serious about enhanced traceability and is investing to make this a reality. 

CI:  Is there an advantage to being an early adopter of a system or should we just wait until the laws have been fully written and passed?

Andrew: From my dealings with Commercial Buyers and Suppliers I get the impression that the drive for significantly improved traceability is here already regardless of any legislation working its way through Congress.

Obviously any new laws requiring electronic traceability would dramatically ramp up the requirement for traceability. However, enough companies are seeing the need for and the benefits of electronic traceability that it makes sense to be looking seriously at it now.

The advantages of being an early adopter are that you get the opportunity to determine the best way to implement traceability to meet your needs and the needs of your trading partners.  You also can start to realize now the benefits to be gained through improved risk management, potential supply chain efficiencies and enhanced marketing and branding.

When looking at traceability options, however, I would suggest you select a system that is designed to be flexible and comprehensive so that you know it will not only meet your immediate traceability needs but also your future potential information needs and be able to comply with the requirements of any new laws.  

There is no doubt that electronic supply chain traceability is coming fast and those companies that embrace it have the opportunity to improve their business operations and stand out from their competition.

Andrew Furner, Vice President

Trace Register, LLC.

Seattle, Washington 98104

206.621.1601 x115

www.traceregister.com

Trace Register is a global food traceability company that offers web-based, supply chain traceability for producers, marketers, or certifiers of food products. The Trace Register™ system fully supports the needs of programs that address food safety, sustainability, social responsibility, and/or brand assurance. Trace Register is headquartered in Seattle, and also has offices in China and Japan.   Their slogan, “Helping you trust what you buy,” is added reassurance to buyers that they are getting “the real thing.”