Improving Transparency and Traceability within Supply Chain First Mile

Typically, when organisations speak of supply chain transparency, they focus on the last mile: the product journey from “production to fork”, with a view to reducing energy and waste while optimising efficiency and flexibility in final delivery. However, the first mile of the supply chain – from “farm to production” – is just as important.

The first mile encompasses everything before goods are received for manufacturing an end product, including raw material extraction and cultivation. It can be long, geographically widespread, and complex. It is also often the most challenging part for businesses to track. However, building transparency and traceability into the first mile is crucial to improving resilience and agility and ensuring regulatory compliance.

A 2024 report from Jabil and Industry Week suggested that organisations have recognised the necessity of harnessing supply chain data, with 69% of respondents saying they have limited visibility and need more. With this in mind, Lee Metters, Global Business Development Director, Domino Printing Sciences, considers some of the factors behind the growing importance of first-mile visibility, and looks at how manufacturers can implement processes that will help improve transparency and traceability within this critical part of the supply chain.

The value in end-to-end supply chain visibility

Having complete, end-to-end visibility of supply chains is playing an increasingly important role in helping to promote resilience in an uncertain geopolitical and economic environment. Full supply chain visibility can help manufacturers respond more efficiently to supply and demand changes – and maintain stock (and pricing) levels at times of disruption. It can also help increase consumer and stakeholder confidence in a brand’s environmental commitments and help ensure compliance with new and upcoming regulations.

A well-managed, transparent first mile forms the foundation for an efficient, safe, sustainable, and compliant end-to-end supply chain, while a poorly managed first mile can have the opposite effect.

Lack of first-mile visibility can mean businesses need to hold excess inventory to deal with unexpected changes in demand. In addition, a business without complete visibility of exactly where different batches of raw materials and ingredients are sourced from can run the risk of widespread product recalls and associated reputational damage should an issue occur downstream.

Whereas the focus on supply chain transparency has typically been on the last mile, today, we are witnessing an increase in new regulations requiring brands to provide information on the first mile of their supply chains. Examples include the US FDA Food Safety Modernization Act, aimed at preventing foodborne illnesses, and the EU Deforestation Regulation (EUDR), which covers all deforestation-linked commodities sold in Europe, including wood, coffee, and cattle. Environmental, social, and governance (ESG) reporting regulations are also expected in the coming years, requiring businesses to work with their suppliers to meet Net Zero goals and certify products. The penalties for failing to comply with regulatory requirements can range from hefty fines to possible criminal convictions.

Consumer demand for supply chain transparency is also on the rise. A 2020 study by Fashion Revolution suggests that as many as 69% of EU consumers want to know how their clothes are manufactured, while 2022 research from Harris Poll, commissioned by Google Cloud, found that 66% of shoppers actively look for eco-friendly brands, but 72% think that companies and brands overstate their sustainability efforts.

So, how can manufacturers go about embracing full supply chain traceability? According to a 2024 MHI report, visibility and transparency are key trends impacting supply chains, and businesses should consider prioritising technology investment and supplier collaboration as a means of improving transparency.

Supply chain digitisation

Adopting traceability in the first mile has historically been challenging. Many manufacturers will deal with a high volume of small-scale raw material providers and handlers in multiple countries and are likely to have data management hampered by manual, error-prone processes.

However, technology solutions focused on transparency and traceability have advanced in recent years. Digital tools such as cloud-based platforms, artificial intelligence, and blockchain are now enabling real-time monitoring and secure data storage to provide detailed, verifiable information about a product’s journey from origin to consumer. Potential solutions include on-product, unique identification codes to facilitate seamless traceability and digital data sharing at the batch level, alongside data analytics and visualisation tools to manage complex data, provide insight, and help streamline decision-making.

1. Track raw material procurement

The first and most important step is working with suppliers to implement traceability record-keeping for raw materials. This includes identifying current gaps in reporting and taking steps to ensure all necessary data is recorded. Understanding what data to collect and how to acquire it is crucial. Companies should collaborate with supply chain partners, provide precise specifications for raw materials, and implement digital record-keeping processes for purchases.

2. Implement batch-level identification

Once raw materials are received at the point of manufacturing, supplier data will need to be linked to the finished product. Variable data printing technology, utilising the latest 2D code technology, can embed batch-specific information, such as batch or lot numbers, and make it accessible via a simple scan. This means that specific raw materials included in specific batches of products can be traced back to the original supplier. Not only will this information enable brands to reinforce their environmental commitments to consumers and other stakeholders, but this kind of granular data will prove very valuable in the event of a product recall, as the affected batch of products and related suppliers can be easily identified.

3. Create a data integration strategy

For some manufacturers, simply tying a product back to a raw material provider may provide sufficient detail – but there is the potential to do more. Businesses should consider creating a data integration strategy and consider how to develop or adopt standards for sharing data among supply chain partners, as well as embracing tools to enable data sharing and analysis.

4. Turn data into actionable insights

Equipped with a robust and reliable flow of batch-level product data, brands can deploy data analytics tools to obtain valuable insights on products as they move through supply chains and link this back to the first mile. Data analytics will require multiple systems to communicate, so companies must consider coding and marking systems that allow for interconnectivity between equipment using industry standards to track and record data across the supply chain.

5. Visualise complex data and identify trends

Taking things to the next level, manufacturers can use an ever-increasing range of advanced visualisation tools to better understand their supply chain data. Examples could include dashboards that show the geographic origin of materials and the flow of goods from raw materials supplier through to the final retailer; simplifying the data in this way can help to identify inefficiencies and / or bottlenecks and improve decision-making with a view to making supply chains run more efficiency.

Conclusion: The first mile – key to a more efficient supply chain

Businesses that focus only on last-mile visibility cannot hope to maintain the levels of agility, resilience, and compliance required today.

By ensuring that products can be quickly and efficiently linked to their origin or raw material providers, manufacturers can lay the foundation for a more efficient, safe, and sustainable end-to-end supply chain – from the very first mile, through manufacturing and warehouse operations, and downstream as products move through retailers and into the hands of consumers.

Supply chain digitisation through advanced technology solutions and digital tools can provide detailed, verifiable information about a product’s entire lifecycle, to help organisations manage demand, streamline decision-making, improve consumer confidence, and ensure compliance.