Food companies and retailers have a problem these days: No longer can they offer a bare minimum of information on the origins of the food they sell. Whether due to health-consciousness or even mere curiosity, consumers want to know more about where the food they eat comes from, as the Wall Street Journal reports:
Fish + People Inc. has been posting on its website the names and photos of the boat captains that caught fish for its new Fishpeople-brand packaged seafood meals and frozen filets over the past three years. Many shoppers are hooked.
The company put special codes on its packages that, when typed into its website, provide information on how each ingredient is produced, and the people involved. Some Fishpeople product packages, which are sold at 7,500 retail locations nationally, now display photos of the captain and the vessel that caught the fish.
“What (shoppers are) most interested in is place and people,” said Fish + People Chief Executive Duncan Berry.
From niche players such as Fish + People to large enterprises such asCampbell Soup Co. and Wal-Mart Stores Inc., companies are rushing to meet consumers’ increasing demand to know more about what’s in their food, where it came from, and how it was produced. Hershey Co.’s new “smart labels” are putting more nutrition information on packages and eventually could showcase where it buys its ingredients. Kellogg Co. and General Mills Inc. now feature on their websites, names and profiles of farmers who grow wheat and oats for their cereals.
Wal-Mart’s Sam’s Club unit recently began putting codes on produce packages that smartphone-wielding shoppers can scan to learn where, how and by whom the food was grown.
But it is a challenge for the largest companies, with complex supply chains, to balance the detail shoppers want with what the companies can deliver.
Analysis: Food Transparency Is a Looming, Complex Priority for CXOs
The WSJ report notes that food transparency efforts are being influenced by the U.S. Food Safety Modernization Act, which was signed into law in 2011. Further regulations in the U.S. and around the world could make food transparency practically a mandate.
Overall, the trend has serious implications for supply-chain leaders, chief marketing officers and CIOs, each of which will play crucial roles in developing the programs, collecting the required information and developing related technology systems.
"You're going to have a digital supply chain attached to your physical supply chain," says Constellation Research VP and principal analyst Guy-Frederic Courtin.
“Be prepared for it," he adds. "If you’re a beef packing company does it all of a sudden mean you need to add more IT staff? If you're a grocery stores do you need more smart displays?"
The other potential challenge lies in how much detail customers will end up demanding, or which can provide a competitive advantage. "Are people going to want to know, hey, the cow where this beef came from? Who is the stud for it and is the mother a dairy cow?" Courtin says. "How far back down the chain do we go?"
The bottom line? “It’s another example of customer driving the relationship with the retailer," Courtin adds. "Now the customer is asking for, if not demanding this kind of information. They are going to make buying decisions based on it.”
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