FREQUENTLY ASKED QUESTIONS ABOUT TRACEABILITY

Serialization is the process of assigning a unique identifier to products. The process allows tracking and tracing of a product’s journey through the supply chain. Many industries, such as healthcare and pharmaceutical, are subject to serialization legislation.

There are many reasons to serialize, most notably for authentication and traceability purposes. Serialization makes it more difficult and less financially viable for counterfeiters to infiltrate the supply chain. This process helps minimize the risk to consumers by improving product safety while also minimizing financial and reputational risks to brands.

Aggregation is the association of uniquely serialized items to higher packaging levels that also have a unique serial number. The serialized items inside a container are known as the “children,” and the serialized container containing these items is called the “parent.” In a bundle of bottles or cartons, for instance, each unit has its own serial number, and the bundle itself has a top label that includes a unique serial number. In this case, the bottles or cartons are the children, and the bundle is the parent.

In short, aggregation is the process of creating a hierarchical relationship between unique identifiers assigned to packaging containers.

Both terms are often used interchangeably to describe the process of using data collection to follow a product through the supply chain.

Tracking monitors the location and status of a product as it moves along the supply chain (where it is at any given time, how it got there and under what conditions), while tracing reveals the origin and history of the product (where it came from and where it’s been).

The market demand for traceability technologies is high because the implications for public health, corporate transparency and anti-counterfeiting efforts are significant. For instance, the global food traceability market was valued at $10,963.0 million in 2017 and is expected to reach $22,274.1 million by 2025, registering a CAGR of 9.3% from 2018 to 2025, according to a report by Allied Market Research.

Supply chains are complicated by the vast number of manufacturers, suppliers, distributors and products. Different producers use different product identification systems, with different software and different sensors to track all kinds of products. The complexity of each supply chain and costs involved in adopting end-to-end traceability — from raw materials to the consumer — has discouraged many companies in the past.

But now, with emerging technologies such as artificial intelligence (AI) and the Internet of things (IoT), simpler and less costly solutions are available.

Webster’s Dictionary defines blockchain as “a digital database containing information (such as records of financial transactions) that can be simultaneously used and shared within a large decentralized, publicly accessible network.”

Also known as distributed ledger technology (DLT), blockchain is a database used to authenticate and store transactions and other data in digital “blocks.” Eliminating the need for a trusted third party such as a financial institution, blockchain relies instead on a system of consensus involving thousands of computer users, or “nodes,” within the blockchain network to validate data. Because the data within a block is stored permanently and cannot be retroactively altered without affecting all the other blocks in the chain, the technology is considered by many to be a secure, viable and potentially valuable alternative to traditional, centralized data management systems.

The Internet of things (IoT) refers to the Internet connectivity of electronic devices and everyday objects ranging from cell phones to household appliances. When combined with traceability technologies, the IoT allows consumers to scan items before purchasing them to learn about their origin, components, sustainability, etc., among other applications.

The same concept allows brands to gain valuable insights into their customers’ purchasing habits, which can then be used to develop targeted marketing campaigns aimed at securing or enhancing customer loyalty.