Vaché notes that the information captured in a traceability program can help lower costs and raise quality. Examples range from allowing a cooling facility to maximize freshness by reordering deliveries based on when the loads were harvested, to paper savings of as much as $20,000 per year on the receiver side. “The sales folks know exactly what’s being harvested and can sell it to the right customer and make the right adjustments on a daily basis.”
Other benefits can touch on quality assurance and payroll, according to Ed Treacy, vice president for supply chain efficiencies at the Produce Marketing Association. He knows of companies that assign lot numbers by picking crew, with the resulting competition leading to more efficiencies and lower rejection rates. One company even put the packer’s picture on the PTI label as a means of improving efficiency, and saw marketing benefits as well. “It gives (wholesalers) confidence and trust in what they are buying,” Treacy says. “I don’t know if it is influencing buying, but it’s being noticed.”
Produce companies are starting to take the benefits as well as the costs into account. “We’re having deeper, more sophisticated discussions with customers about the supply chain,” says iTradeNetwork’s Connelly.
“We’ve seen a big increase in our warehouse management software sales in the past few years, and I attribute this in part to people realizing they need to get their inventory challenges resolved before they move to traceability,” observes Todd Baggett, director of business development at Santa Clara, CA-based Redline Solutions. “The strong ROI is probably the main reason.”
“In the early days it was about compliance, but all the companies have evolved to acknowledge that you can get business value beyond compliance,” asserts Townsend. “If you’re spending the money anyway, why not do it to improve the operation? A lot of companies have a process orientation, so anytime they need to make a change due to an external initiative, such as PTI, they look for opportunities to improve their processes.” At Nunes, the traceability program’s implementation triggered cooler improvements. “We were thinking of doing it anyway, but we did the upgrade for PTI,” Townsend says.
Giumarra, for example, added a reporting feature to its traceability solution to generate reports by region and predict future harvests. “We collect a lot of data that we didn’t before,” Heil explains. The company also realized that the traceability sticker did not need to lead to additional work beyond the other required case markings. “We developed a solution that encompasses all the information we needed for cardboard and RPC cases, so it wasn’t an additional step, it was one step.”
Selection and Deployment
“Don’t overcomplicate the process,” Treacy counsels. “It’s not that difficult to adhere to the standards. Some companies think they have to reinvent the wheel.” Vaché concurs: “You can make adjustments to what you already do and not recreate the whole process.”
Grant recommends starting by clearly delineating objectives. “Do you just need to comply with Walmart’s requirement, or do you want to leverage the investment to also improve quality and inventory rotation?” Thinking through the various benefits and goals “will help you find a solution without getting sucked into buying features you don’t need.”
