Product Traceability – A Way to Enhance Supply Chain Efficiency and Reduce Costs

Overview:

Product traceability enhances supply chain efficiency by providing comprehensive tracking and management of goods from production to delivery. This transparency ensures quality control, minimises errors, and facilitates quick responses to issues like recalls or defects. By optimising inventory management and reducing waste, traceability also leads to significant cost savings, making it an invaluable tool for businesses aiming to streamline their operations and improve overall supply chain performance.

What is traceability in manufacturing?

Traceability in manufacturing refers to the ability to track the history, location, and application of products and their components throughout the production process. It involves documenting detailed information at each stage of the manufacturing cycle, from raw material sourcing to final product assembly. This data is recorded in a traceability system, allowing manufacturers to monitor the origin and journey of every part and product.

Traceability helps ensure quality control, compliance with industry standards, and quick identification of issues such as defects or recalls. It enhances transparency and accountability, enabling manufacturers to optimise processes, reduce waste, and improve overall product quality and safety.

Chain Traceability

Chain traceability refers to the ability to track and trace a product and its components through the entire supply chain, from raw material suppliers to end consumers. It provides a comprehensive view of the product’s journey, documenting each handoff and transformation. This end-to-end transparency helps ensure product authenticity, quality, and compliance with regulatory standards. Chain traceability is crucial for managing recalls, detecting counterfeit products, and maintaining consumer trust by verifying that the products meet all safety and quality requirements.

Internal Traceability

Internal traceability focuses on tracking and documenting the movement and transformation of materials and components within a single organisation or production facility. It involves detailed recording of processes such as assembly, inspection, and packaging. Internal traceability ensures that each step in the manufacturing process is monitored, allowing for quick identification of defects and quality issues. By maintaining precise records of internal operations, manufacturers can optimise workflows, improve quality control, and ensure compliance with industry standards, ultimately enhancing the overall efficiency and reliability of their production processes.

What is end-to-end traceability?

End-to-end traceability refers to the comprehensive tracking and documentation of a product’s entire journey through the supply chain, from the initial sourcing of raw materials to the final delivery to consumers. This concept encompasses every stage of the production and distribution process, providing a seamless and transparent view of a product’s lifecycle.

End-to-end traceability involves capturing detailed data at each step, including information about suppliers, manufacturing processes, quality inspections, logistics, and retail handling. This holistic approach ensures that all aspects of a product’s movement and transformation are monitored and recorded. By integrating advanced technologies such as RFID, barcodes, and blockchain, businesses can achieve real-time visibility and data accuracy.

The benefits of end-to-end traceability are manifold. It enhances product quality and safety by enabling quick identification and resolution of issues, such as defects or contamination. It also aids in regulatory compliance, as detailed records can demonstrate adherence to industry standards and legal requirements. Additionally, end-to-end traceability helps prevent counterfeiting and fraud by verifying the authenticity and origin of products.

Why is product traceability in manufacturing important to implement?

Product traceability in manufacturing is crucial for several reasons. It ensures quality control by enabling manufacturers to track the history and journey of each component and finished product, identifying defects and inefficiencies promptly. This level of oversight helps in maintaining high standards and consistency.

Traceability also enhances regulatory compliance, as manufacturers can provide detailed records to meet industry and legal requirements, reducing the risk of non-compliance penalties. In the event of a product recall, traceability allows for swift and precise identification of affected items, minimizing the scope and cost of recalls while protecting consumer safety.

Additionally, traceability combats counterfeiting and ensures product authenticity, which is vital for maintaining brand integrity and consumer trust. By optimizing production processes and supply chain management, traceability ultimately leads to cost savings and improved operational efficiency.

How to track production in manufacturing?

Tracking production in manufacturing involves several key steps to ensure efficiency and quality control:

  1. Implement Technology: Use technologies like RFID, barcodes, and QR codes to tag and track materials and products throughout the production process. These technologies provide real-time data on the location and status of items.
  2. Utilize Software Systems: Employ Manufacturing Execution Systems (MES) and Enterprise Resource Planning (ERP) systems to collect, manage, and analyze production data. These systems integrate with other tools to provide a comprehensive view of the manufacturing process.
  3. Data Logging: Record detailed information at each production stage, including raw material usage, processing times, quality checks, and assembly steps. This data helps in identifying bottlenecks and areas for improvement.
  4. Regular Audits and Inspections: Conduct routine audits and inspections to verify that processes are being followed correctly and to ensure that products meet quality standards.
  5. Employee Training: Train staff on the importance of data entry and accurate reporting. Proper training ensures that the tracking system is used effectively and consistently.

By combining these methods, manufacturers can maintain a clear and accurate view of their production processes, leading to improved efficiency, quality, and overall performance.

How to improve traceability?

Improving traceability involves several key steps. First, invest in advanced technologies like RFID, barcodes, and blockchain for real-time tracking. Integrate robust software systems, such as MES and ERP, to manage and analyse traceability data. Standardise procedures for data entry and reporting to ensure consistency. Enhance collaboration with supply chain partners to maintain transparency. Conduct regular audits to identify and address gaps. Train employees on the importance of traceability and the proper use of systems. Lastly, leverage data analytics to optimize processes and predict issues. These steps collectively enhance  traceability, improving efficiency, quality control, and compliance.

Utilize Traceability Software

Employ traceability software to centralise and manage data across the supply chain. This software integrates with existing systems to provide real-time visibility into product movements, processing stages, and inventory levels. By offering detailed tracking and reporting, traceability software enhances accuracy, facilitates compliance, and improves decision-making.

Enact Supplier Traceability Controls

Establish strict traceability controls with suppliers to ensure that every component and raw material meets quality and safety standards. Require suppliers to provide detailed documentation and records of their products. Implement regular audits and compliance checks to maintain transparency and accountability throughout the supply chain.

Implement Barcoding

Adopt barcoding to streamline product identification and tracking. Barcodes encode essential product information, which can be quickly scanned and recorded at various stages of the supply chain. This method improves accuracy, reduces manual data entry errors, and enhances the efficiency of inventory management and quality control processes.

Incorporate RFID Technology

Integrate RFID technology to enable real-time, automated tracking of products and components. RFID tags store detailed information about each item, which can be read without direct line-of-sight, offering enhanced visibility and accuracy. This technology supports efficient inventory management, reduces errors, and provides comprehensive data for traceability.

Provide Employee Training

Ensure employees are well-trained on traceability systems and processes. Training should cover the use of traceability software, barcoding, RFID technology, and the importance of accurate data entry. Regular training updates help maintain high standards and ensure that staff are equipped to manage traceability effectively.

Incorporate Lean Manufacturing Processes

Adopt lean manufacturing processes to optimize production efficiency and minimize waste. Lean principles, such as continuous improvement and just-in-time production, complement traceability efforts by enhancing process visibility and reducing unnecessary steps. This integration leads to more efficient operations and better traceability outcomes.

Reducing Costs through Efficiency

Reducing costs through efficiency involves optimising operations to eliminate waste and streamline processes. By implementing lean manufacturing principles, businesses can minimise excess inventory, reduce production time, and lower labour costs. Technologies such as automation and advanced data analytics further enhance efficiency by improving accuracy, reducing manual errors, and speeding up workflows. Efficient supply chain management and process improvements also help in cutting operational expenses and lowering overhead costs. These practices lead to higher productivity, faster time-to-market, and better resource utilisation, ultimately driving down costs while maintaining or improving product quality.

Frequently Asked Questions

1. What Is the Main Objective of Product Traceability?

The main objective of product traceability is to monitor and document the journey of products from raw material to end consumer. This includes tracking each stage of production, handling, and distribution. Traceability helps ensure quality control, compliance with regulations, and efficient management of recalls or quality issues, ultimately enhancing transparency and accountability in the supply chain.

2. Why Is Traceability Important, Especially for the Consumer?

Traceability is crucial for consumers as it provides transparency about the origin and handling of products. It helps ensure that products are safe, authentic, and meet quality standards. In case of a recall or safety issue, traceability enables quick identification and removal of affected items, protecting consumers from potential harm and building trust in the brand.

3. Can Product Traceability Help in Reducing Costs Within the Supply Chain?

Yes, product traceability can reduce costs by improving supply chain efficiency. It helps minimise waste, prevent counterfeiting, and reduce the scope and impact of recalls. By streamlining inventory management and enhancing process visibility, traceability supports better decision-making and operational efficiency, leading to overall cost savings.

4. What Technologies Are Commonly Used for Product Traceability?

Common technologies for product traceability include RFID (Radio Frequency Identification), barcodes, QR codes, and blockchain. RFID and barcodes facilitate automated tracking and data collection, while QR codes provide detailed product information accessible via smartphones. Blockchain offers secure and transparent data recording, enhancing traceability across the supply chain.

5. Is Product Traceability Applicable to All Industries?

Yes, product traceability is applicable to all industries, including food and beverage, pharmaceuticals, manufacturing, and retail. Each industry uses traceability to ensure product quality, safety, and compliance with regulations. While the specific requirements and technologies may vary, the fundamental goal of traceability—improving transparency and accountability—is universal.

6. What Types of Data Are Typically Tracked Through Product Traceability Systems?

Product traceability systems typically track data such as raw material sources, production processes, quality control results, handling and storage conditions, distribution routes, and final destination. This information provides a comprehensive view of the product’s journey and helps in managing quality, compliance, and supply chain efficiency.

7. How Does Product Traceability Help in Maintaining Product Quality and Safety?

Product traceability helps maintain quality and safety by providing detailed records of each stage in the production and distribution process. This allows for quick identification and correction of issues, such as defects or contamination. Traceability also supports rigorous quality control and compliance with safety standards, ensuring that products meet required specifications and are safe for consumers.

8. What Are the Regulatory Requirements Related to Product Traceability?

Regulatory requirements for product traceability vary by industry and region but generally include the need to maintain detailed records of product origin, production processes, and distribution. Regulations often require businesses to have systems in place for tracking and managing product information, reporting issues, and facilitating recalls. Compliance with these requirements helps ensure product safety and quality, and avoids legal and financial penalties.

What is a 13-Digit GTIN Number and Why Is It Important for a Retail Product?

Global Trade Item Number (GTIN) can be used by a company to uniquely identify all of its trade items. GS1 defines trade items as products or services that are priced, ordered or invoiced at any point in the supply chain.

If you’re planning to sell your products in a retail market and want to ensure its effective movement in the supply chain, you need to have a 13-digit GTIN number encoded in the barcode of your product.

Let’s understand what GTIN is and why it is important for your products.

What is GTIN and Why is it important for your products?

Global Trade Item Number (GTIN) is an internationally recognized code to identify trade items that uniquely identify products globally and fetch accurate and efficient product information when scanned at the billing counters in a store or at a warehouse when receiving goods.

GTINs are also used in pharmaceutical drugs, where they are scanned while administering medication in a hospital to enhance patient safety or scanned while effecting receiving or dispatches at hospital store to maintain inventory, ensure faster processing.

Most commonly used GTINs are 13 digits code, known also as EAN code. Also, there are several different types of GTINs used on products. This includes:

  • GTIN 12: The GTIN-12 is encoded in UPC barcodes, which are predominantly used only in America and Canada. However, North American and Canadian companies have steadily been updating retail Point-of-Sale systems to be able to scan GTIN-13 and GTIN-8. If your trading partner still cannot scan these numbers, only then you will need to use a GTIN-12.

  • GTIN 13: European Article Number (EAN); 13 digit code used in the rest of the world including India. GTIN 13 (barcode number) in India starts with 890.

  • GTIN 8: Allows a smaller barcode to be used on smaller retail trade items.

  • GTIN 14: Used on general distribution trade items, not intended to be sold at the Point-of-Sale.

All GTINs, irrespective of their different digits or codes, have a similar structure under which each GTIN digit is made up of 4 components. The first component is Country Code which varies from country to country; the second part is Company Prefix, the length of which is functioned according to the company’s coding needs; the third component is Product Code, which is assigned by the brand owner to uniquely identify the product and the fourth component of GTIN is Check Digit, which is based on the previous digits and ensures that the GTIN is constructed properly.

Where are GTINs used? 

GTINs are used in various aspects, especially where a product needs identification. That also includes IT systems, physical entities, etc. GS1 Standards define how to format and structure the GTIN in various applications so that the same GTIN can be used to identify the product for any of those needs.

  • Physical products: GTINs can be encoded into both barcodes and RFID tags along with the serial number and affixed to products to facilitate accurate identification as products move along with the supply chain.

  • Business transactions: GTIN can be used in e-commerce business transactions in order to reduce errors and boost machine-to-machine processing.

  • Internet applications: They can be represented as a Uniform Resource Identifier (URI) using GS1 Digital Link to support internet-based applications. 

  • Databases & IT systems: GTIN can provide each product an identifier that can be used in systems like inventory management, logistics, etc, that helps to maintain the connection between the systems to enhance the quality and amount of data.

Benefits of labelling your product

By identifying your products with a GTIN number, you can:

- Gain increased visibility of your product pages in Google searches

GTIN numbers when also used in product pages help you achieve better SEO results by improving the visibility of your product pages in Google search results.

According to Google, database sheets with GTIN codes are classified at a 40 percent higher click rate and earn 20 percent more sales.

- Free barcode management through DataKart service

With a GTIN number on the product, you can easily assign and manage your GTIN numbers through free access to GS1 India’s DataKart service. It will allow brand owners to upload product information from a one centralized location and its advanced features enable sharing the product data with multiple suppliers in one go in their respective native file formats/structures.

- Facilitate exports of your product worldwide

As GTIN numbers are internationally recognized, you can easily export your products across the globe with GTIN numbers, eliminating the need to identify your products differently for export purposes.

GTIN Structure

GTIN Structure includes a string of digits, it can be 8,12,13, or 14 digits in length to accommodate different product limitations. Depending on the length these structures are known as GTIN-8, GTIN-12, GTIN-13, and GTIN-14. The GTIN usually has the following elements:

  • Indicator Digit: Indicator Digit is a number that ranges from 1-8, that is used to identify packaging levels/hierarchy of a product.

  • GS1 Company Prefix: A globally unique number assigned to a company by a GS1 Member organisation in order to generate GS1 Identification keys like GTINs.

  • Item Reference: An Item Reference number, that has no logical explanation, it is just a number assigned by the user itself to identify a trade item. It’s length is based on GS1 company Prefix Length.

  • Check digit: The Check Digit is the last or final digit calculated from the preceding digits of the GTIN number. This digit is extremely important as this is used to check that the data is correctly collected.

GS1 and GTIN

If you want your product to be recognized in the marketplace, you need to have a GTIN code on the back of it, encoded in a barcode/RFID. GS1 – the global supply chain standards organisation, provides unique and universal identification to products through GTIN.

GTINs can also be used to uniquely identify products at different packaging levels; for instance- at the customer unit level, at the inner pack of the product, and at the carton/pallet.

After realizing the importance of GTINs in the supply chain, mostly all the brand owners are now labelling GTINs on their products to boost their visibility in the marketplace so that they can sell their products on various platforms.

Connect with GS1 India and reap all the benefits of GTIN number.

Frequently Asked Questions

1. How do I get a GTIN code?

If you want to sell your products on any e-commerce platform site, then you would have to register your business at GS1 India's official website for the allocation of GTINs. These are generated through their single repository for data of all the products in India - Datakart. This platform enables the online generation of GTINs and the management of all the product information at one place.

2. Is the GTIN code the same as the UPC?

A GTIN code and UPC are not the same in their structure. A GTIN code can have 8,12,13, or 14 digits, while a UPC can only have 12 digits. Another difference between these two is the fact that GTIN codes can be used globally, while UPCs can only be used in North America.

3. What is a 14-digit GTIN barcode?

GTIN-14 is a 14 digit number used to allocate trade items at different packaging levels. The encoding of barcodes of the GTIN-14 basically happens within an ITF-14 barcode, but various industries and applications use GS1-128 to encode GTIN-14s.

4. How do I find my GTIN number for my product?

GTIN also known as Global Trade Item Numbers (GTIN) are used to identify every product sold on any e-commerce site. GTIN is a universal identifier that is found on the product's cover or packaging, either above or below the bar code.

5. Is GTIN different from barcode?

GTIN is a unique identifier number that is used in a barcode. It is the numerical form data, and the UPCs or EANs are the barcode images that contain the GTIN.

6. What is the difference between SKU, EAN and GTIN?

The SKUs are in the form of a series of numbers and letters that can change depending on the inventory of the product in a specific business. EAN is an international identifier in the form of a barcode image that has been involved in the GTIN system.

Demand for Local Products Expected to Rise With PM’s Appeal ‘Vocal for Local’

Two weeks back, Prime Minister Narendra Modi encouraged the citizens of India to buy local products and be a part of India’s growth story. He also appealed SMEs’, start-ups and entrepreneurs’ to make the nation independent and self-reliant by making as many local goods as possible to remove dependence on imported goods. This would also support the country’s economy, which is hit by a prolonged phase of lockdown due to the coronavirus pandemic.

He highlighted that the coronavirus outbreak has made us realize the importance of local manufacturing, local market, and the need to make our supply chains efficient & sustained.

“In times of crisis, this local has fulfilled our demand, this local has saved us. Local is not just the need, it is our responsibility also,” he said in his speech to the nation.

However, local does not only mean products made by Indian companies, but also those manufactured in India by multinational companies or MNCs.

The ongoing health crisis has given an impetus to the sales of local products, as they inspire consumer confidence.

The moment the pandemic hit the nation, not even a single PPE kit was manufactured in India, only a few N95 masks were available. However, with our exceptional local manufacturing capabilities, we are able to produce close to two lakh PPE kits and two lakh N95 masks on a daily basis.

Also, as per news reports, India is the world’s number 2 in its masks making capacity and is planning to export as well.

This offers an opportune time for SMEs / start-ups to make their local products and get them recognized in the marketplace with the use of India barcodes, starting with 890.

890 barcode numbers identify your products on a globally unambiguous way, ensuring that no other product across the world will have this number in an authorised manner. This is because these numbers are developed and maintained by a global supply chain standards organisation – GS1. In India, GS1 India is the only authorised body to allocate GS1 barcode numbers, starting with 890, to companies based in India.

Not only these barcode numbers ensure that the company manufacturing these products is based in India but also help manufacturers in selling them through retail chains and online marketplaces.

In these difficult times, it is critical for manufacturers of local products to speak the global language of business and be visible on several sales (retail) platforms that are being used by consumers to fulfil their daily needs.

Additionally, the use of 890 barcode numbers facilitate counterfeit detection in the supply chain at its point of entry and enable manufacturers to investigate and deal with the counterfeit sources.

Summary of benefits accrued by labeling your products with ‘890’ barcodes:

Unique identification of your products

  • Ability to sell products through leading retailers and online shopping channels ● Free access to online tool (DataKart) for easy generation, management and allocation of barcode numbers.
  • Counterfeit detection in the supply chain
  • Retailers and online marketplaces can easily validate the barcode numbers used by you
  • Increased visibility of product pages in Google searches

In order to be vocal about local products, use 890 barcodes on your products and popularise the fact that these barcode numbers mean that the products are manufactured in India.

To know more about 890 barcode numbers, visit: https://www.gs1india.org/content/register-for-barcodes/

Need Help?

Chat Support