Due to an increasingly globalized food chain and economic incentives to provide products at a lower cost, food fraud has become a major headache for food brands everywhere. According to the Grocery Manufacturers Association, food fraud is estimated to cost the global food economy between $10 and 15 billion a year. In fact, food fraud affects about 10% of all commercially sold food products.
Not a month goes by without news outlets covering yet another case of food fraud, from counterfeit high-end products, like olive oil, wine and cheese, to products that purport health benefits but have little active ingredients, and even falsely labeled organic or non-GMO foods. What’s more, incidents related to food safety are on the rise, with massive outbreaks of salmonella and listeria, and foods that are tampered with using ingredients that many people are allergic to. These types of scandals take a heavy toll on a food company’s brand – and its bottom line – as it grapples with the aftermath.
Studies abound regarding consumers’ growing concern about what they are really eating and if they are getting what they pay for. For example, a study conducted by Dalhousie University found that 63% of Canadians are generally concerned about food fraud and that 42.7% believe they have bought a counterfeit food product at some point. Even Chinese consumers are becoming increasingly distrustful of the quality and safety of domestic food supply chains.
Non-governmental organizations (NGOs), policy makers and other influential groups are also putting more and more pressure on food brands to improve food integrity and better safeguard the overall food supply chain.
But despite the fact that many food manufacturers are on board to fight food fraud, it is nevertheless a very challenging issue. First and foremost, food fraud can take any form, such as adulteration, tampering, theft and simulation, counterfeiting, etc. Now, combine all these types of food fraud and add them to a complex food supply chain with many actors. Now you have a problem so intricate that food brands cannot rely on traditional control measures alone.
Another food fraud challenge is the lack of upstream supply chain visibility. Most food brands use one-up, one-down traceability, which does not cover the full spectrum of suppliers working to produce one specific food item.
While stricter audits and certifications, new government regulations, more severe sanctions and reputable suppliers can efficiently reduce the risk of food fraud, they are not enough to systematically detect and prevent it before the food ends up in the consumer’s plate.
What food brands need is to implement a product-based digital traceability system, so that every single product – from raw materials, up to the end product – has a unique identifier. With this data, the supply chain becomes connected and offers food brands real-time and accurate data to monitor what is happening with their products. Food manufacturers can then quickly pinpoint irregularities or suspicious activities throughout the entire supply chain.
In a nutshell, an end-to-end traceability system provides food manufacturers with data-driven insights into a product’s manufacturing, distribution and authentication history. With this invaluable information, food brands can take action sooner, should food fraud arise, and guarantee both food safety and authenticity to consumers.
READ RELATED CASE STUDY: Using Digital Traceability to Increase Food Safety and Regain Trust