Why is blockchain important to the packaging industry?

From volatile crypto currency to a solid system adding value for the supply chain. Blockchain technology can be the key to value chain transparency and a solution to the ever-growing problem with counterfeits.

What is it?

A Blockchain is a database of records, here called blocks. What makes the database special is that these records are interlinked, or chained, using a hidden code. This is useful in a supply chain involving transport and transactions that can be recorded as blocks. Each block contains a cryptographic link to the previous block plus information on when a transaction occurred, who was involved and much more.

This may sound slightly abstract, but it makes the Blockchain concept decentralised and transparent. A key element is that the process is spread out across multiple computers with the consequence that no one has ownership of the information on the “ledger”. A non-corruptible database!

Using a Blockchain you bypass the concept of a centralised organisation by giving everyone involved a complete and unalterable copy of the register of all transactions.

Why is it important for packaging?

Blockchain technology relates to packaging as it can be used to:

  • Provide consumers information regarding a product’s authenticity and origin. The identity of a product can be verified as the packaging is read and recorded to the “ledger” when handled along the transport, all the way to the destination. As the records can’t be altered retroactively, it means that all information on the ledger is by default authenticated, but without the paperwork of today.
  • Track and trace products along the value chain. When the value chain (packaging converters, printers, raw material producers, fillers, brand owners, retailers, etc.) join up in a Blockchain and makes the process transparent they will all share the same picture of origin and handling of products. If a batch is contaminated it can then easily be traced. Traceability is a key aspect and an opportunity, in particular for the food and pharma industries.
  • Ensure brand protection and serve as anti-counterfeit technology. Consumers will be able to tell a fake product simply pointing their phone at the packaging and read the QR code. Blockchain will prove to be a useful tool for building brand trust as a neutral and immutable system.

The demand for transparency and traceability is increasing, driven by counterfeits troubling the pharma industry and recent food scandals that shook the industry. Using Blockchain technology the consumer with a smartphone can simply scan a QR code on the packaging to follow the product journey, from farm to plate.

Who are using it already today?

It might not be mainstream, yet, but the technology is already in use for mundane items such as milk and coffee. In the lead we find major food suppliers like Arla who are running a pilot project in Finland using Blockchain to provide transparency for milk products. Nestlé recently started up their pilot but in a larger, or even global scale involving milk and oil. Barilla is using the technology in Italy to certify fresh basil.

Also the retailers are also into this. Carrefour is leading in Europe using the technology on a number of categories like poultry, eggs, cheese, milk, oranges, etc. On the other side of the pond Walmart is demanding Blockchain traceability for selected vegetables.

Where is this going?

This is only the beginning. Driven by the main advantages’ security, decentralisation and transparency Blockchain as a tool will gain momentum and develop fast.

The technology might seem complicated to use, but the tools are available and new entrepreneurs are coming in with easy to use solutions. With a straightforward access we can expect to see a rapid adoption rate, with a variety of applications. The packaging industry needs to be ready to handle their part of the chain of blocks. Printing and packaging are keys for success.

Illegal, immoral… and not a bit fun

Counterfeiting is a growing problem, no doubt, and it’s not only about expensive bags, perfume and alcohol. This is also very much a concern for the pharmaceutical industry where dodgy imitations slip into the system. Today the situation is the same or worse for all the above categories, and it’s getting nastier…

fakefoodThe forging and faking is breaking new grounds and is sliding down the price curve. Nothing is sacred and there are fake soft drinks to be found, as there is fake olive oil, not to mention fake milk and wine. The other day a production site for fake alcohol was found in the UK. A plant making fake brand-name vodka was raided in Derbyshire. We are especially grateful these imitators were stopped as they were fortifying their product with anti-freeze…

Europol has during the last couple of months been busy coordinating efforts to curb counterfeiters and have as a result seized a staggering 2500 tonnes of fake food products. The damage is not only to the brand name but forged products can be harmful in other ways as well. Obvious when the product is topped up with anti-freeze or similar.

It not easy to spot the real McCoy as the crooks are rather sophisticated. Not all are though,fakeschampoo some of the taken vodka bottles were giving it away with obvious spelling mistakes on the label. What to do then if you want to take the risk and go further than to your micro brewed beer and locally produced produce?

The problem needs a good solution and that as fast as possible. A fake can seldom be spotted just by looking at the product. There are many suggested ideas for how we can distinguish the bad apple. It seems to be hard to agree on a standard so it better to find a solution that fits your product category. If it is printed electronics, holographic prints, RFID technology, security ink, product numbering, watermarks or invisible printing. It’s not cheap but the alternative is worse.

You will have to add something to the packaging that is hard to copy to make it more antifaketagdifficult or even impossible to copy. Last week Diageo and Thin Film Electronics presented a “smart bottle” with a printed sensor tag. The tag can be read using a smart phone and will convey any information the producer adds to the tag. The read tag will confirm the origin and of course give other interesting information to the consumer. Brilliant.

This is all new and the tag will be properly introduced next week at the electronics conference in Barcelona. This is good news as we need many solutions to this growing problem spreading across food categories. It doesn’t mean that I will stop supporting my local micro brewer but it will make life easier and safer for the consumers of the world. More ideas to make faking brands harder, please.