How Food And Retail Can Collaborate Via Blockchain

Although many people equate blockchain technology with the banking and computer worlds, the technology is changing the food landscape as well. Companies like Walmart, Kroger and Nestle recently joined a partnership effort involving blockchain, signaling that the Internet of Things is making its way into Americans’ kitchens. But what hasn’t been so deeply explored is how that technology can help food producers and retail firms collaborate more deeply, helping both succeed and strengthening the industries that power them.

The term “blockchain” refers to a database that continually grows based on records and data that is added to it, Business Insider reports. “Blockchain technology enables a new era of end-to-end transparency in the global food system — equivalent to shining a light on food ecosystem participants that will further promote responsible actions and behaviors,” said Frank Yiannis, Walmart’s vice president for food safety. “It also allows all participants to share information rapidly and with confidence across a strong trusted network. This is critical to ensuring that the global food system remains safe for all,” CNBC reported.

The technology has long been used by banking institutions but is only now segueing into other industries, and the new food/retail collaboration could be setting up the category for a new era of innovation.

Merits Of The Collaboration

Currently, the overall food supply chain consists of agricultural producers, industrial processors and manufacturers, distributors, stores, consumers and many smaller stages in between, Forbes reports. In the past, it has been challenging for retailers to find the source of a potential foodborne illness, which can delay recalls and lead to more sick people.

When the World Health Organization performed global estimates of foodborne diseases in 2015, the organization discovered that nearly one in every 10 people gets sick every year from contaminated food, with more than 400,000 resulting deaths each year, PC Magazine reports. For example, a Centers for Disease Control and Prevention study reports that when a salmonella outbreak recently occurred, investigators were unable to trace the source to the farm where the papayas were grown for over two months.

But with the new collaboration, every member of the food supply chain, from growers to consumers, can get “permissioned access” to data about a food’s origin, Forbes reports.

“You have these big manufacturers like Dole and Tyson that buy the ingredients or have farmers growing produce items,” said Howard Popoola, Kroger’s vice president of Corporate Food Technology and Regulatory Compliance, to PC Magazine. “Blockchain is like one universal language getting spoken. If there’s one QR code, it goes on every package. There’s also a kind of firewall, so Kroger can’t know what Walmart ordered, but with the same QR code, Walmart can scan where a product came from and see it came from the same facility as ours. The transparency and simplicity this brings to the supply chain saves hours of manpower.”

The blockchain collaboration is also expected to help food retailers fend off the growing threat from Amazon, which not only delivers groceries but also recently completed its acquisition of Whole Foods. In 2016, overall retail sales climbed just 2.1 percent, the smallest increase in seven years, based on data from the Retail Industry Leaders Association and reported by Bloomberg. Battling Amazon’s ultra-efficient supply chain with the new blockchain technology could be just what retailers and food producers need to help keep pace with the online retail giant.