The Role of Intelligent Packaging in Combating Food Waste through Supply Chain Transparency

The primary objective of Intelligent Packaging is to combat waste generation, improve overall product shelf life, reduce the risk of counterfeiting, and improve tracking and tracing of products. This is enabled through transparency and visibility across the supply chain starting from the sourcing of ingredients to manufacturing facilities to the last mile delivery. With rapid advancements made and the technological prowess of Intelligent Packaging solutions, this could easily be the single most important answer to address supply chain loopholes.

Future Market Insights recently organized a webcast to discuss trends in the intelligent packaging industry, key technologies, and their impact on how Intelligent Packaging helps tackle supply chain challenges. During this webcast, guest speaker Tyler Chaffo, Manager – Global Sustainability at Avery Dennison Smartrac, discussed the role of Intelligent Packaging in the food supply chain industry at length that helps combat food waste.

“Food wastage alone contributes to 10% of the greenhouse gas emission. In developed countries, retail food space sees 20-50% food wastage every year” said Tyler emphasizing the importance of information transparency, waste labeling, cold sensors, and dynamic pricing that enables food manufacturers and retailers to make well-informed decisions and reduce food wastage.

The impact of food waste due to supply chain gaps

Annually 1.3 billion tonnes of the food produced globally is being thrown away. Around 40% of the food produced does not even reach tables and while most of this wastage is in fresh produce, groceries, QSR, restaurants contribute to 30% of food waste. In terms of value, we are talking about losses to the tune of US$165 billion annually. Apart from revenue loss, food waste negatively impacts society and our environment as well. Government and businesses must join forces to reduce food waste significantly.

Most of these losses are due to inefficiencies and gaps in the supply chain and logistics process. Future Market Insights report on Food Waste Management Market projects, 85 to 95% of overall food wasted in the developing economies is from supply chain including manufacturer waste.
Intelligent Packaging as an answer to food waste through improved supply chain transparency

There are several ways in which Intelligent packaging can be used to maintain the integrity of the food product and thus prevent wasting through monitoring temperature, humidity, tilt, and other critical factors for the safety of products.

Such packaging solutions can also be programmed to reduced order picking and customs inspection times through data-enabled codes which are easily scannable and readable allowing warehouse workers to quickly identify the products they need for order picking.

Intelligent packaging also offers real-time monitoring of merchandise in transit wherein both the purchaser and the seller can monitor the journey of the product and receive real-time readings from various checkpoints along the route. This prevents wastage through product theft.

Offering detailed product information to customers and making them aware of a product's journey or how and by when to use a product helps combat wastage to a large extent. QR codes are the norm here, these types of codes are a part of the crate or container itself. While this solution is mostly keeping in mind the customers, channel partners throughout the supply chain can also benefit from the data transparency it offers.

RFID, NFC, two-dimensional bar codes, nanosensors, and related technologies are the future towards enabling supply chain transparency throughout the sourcing, processing, packaging, and distribution process. While the infrastructure cost for setting up and implementing such technologies is still marginally high, as with any new technology that is yet to mature, prices will drop significantly over the next few years and will lead to mainstream adoption making it accessible for most manufacturers.

Way Forward

Integrating intelligent packaging solutions into the existing end-to-end supply chain could not only help in more transparency and lesser product waste, but it’s also a great customer loyalty channel to provide the next level of hyper-personalized customer engagement.

However, the industry must overcome some significant obstacles to achieve economies of scale in this domain - such as high mass-production costs, the complexity of integrating smart devices into current packaging lines, and concerns about security, data privacy, and sustainability. Advanced technologies, implementation of the Internet of Things, and blockchain in packaging may be the answer to these challenges.