Transparency

Going beyond food safety to shine a light on all facets of product information

 

Transparency is often linked to traceability. While transparency was once largely about food safety, it’s now about so much more, including where a product comes from, how it was grown or how the animals were raised, as well as the environmental and social sustainability practices of the producers.

Other factors behind the push for transparency include increased regulations for clear labelling and a proliferation of certification systems and standards. Beyond what’s written on the package, the future sees customers scanning products with their smartphone to find out all they can about them.

Canada’s food and beverage industry responds

As these trends take root, food industry players are increasing their efforts to track products across the supply chain and share information with other parties. Here’s a look at what some food and beverage companies are exploring or are already doing:

Tracing the product

Michael DeGiglio, CEO of Village Farms, says his company’s customers—typically major grocery retailers—demand traceability. Village Farms grows tomatoes, bell peppers and cucumbers in highly controlled hydroponic greenhouses in British Columbia and Texas. “We can trace a product down to a specific row of plants, among millions of rows,” says DeGiglio.

To respond to consumer demand for traceability, La Coop fédérée, which represents more than 120,000 members, farmers and consumers grouped into nearly 55 cooperatives across several provinces, has created chain values in which agricultural producers adhere to strict specifications and a product’s movement is tracked from start to finish. More than one million pork coop products are produced using this method. The goal is to increase this volume and to integrate blockchain technology.

“In the future, we’d like consumers to see us as a stakeholder in food security and as an organization that can provide them with products on a traceable and transparent basis,” says CEO Gaétan Desroches. “Traceability, through blockchain, will help us tell the story of how our products are produced in a transparent manner.”

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Completing the picture

At Quebec-based GURU, a global pioneer in all-natural energy drinks, the product is all about the ingredients, which means transparency is an integral part of the company’s strategy.

“We have full traceability on all our ingredients,” says Luc Martin-Privat, GURU’s Vice-President of Research and Development, Production and Quality Assurance. “Our monk fruit is purchased from one of the best-preserved areas of China.”

The company discusses transparency with its suppliers and ensures ethical sourcing across its supply chain by looking at both the ecological footprint of products and processes and their impact on the local population. For example, an agreement with its monk fruit supplier allows GURU to come and visit the plantation.

As part of its transparency push, GURU sent people to China to pick monk fruit, purchase the rest of the ingredients from the local market and then prepare their own GURU drink.

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Sharing data across the supply chain

Provision Coalition is a food industry advisory service helping manufacturers increase revenues, reduce costs and elevate their brand in a purposeful way. Through its Purpose to Profit model, Provision helps companies create value, realize savings and positively impact the environment and society. As part of its work, Provision Coalition has been building out the concept of transparency.

“As we look to things like the circular economy and responsible sourcing, the only way we’re going to be able to do that is through data,” says President and CEO Cher Mereweather.

“If you don’t know what’s happening in the supply chain beyond the direct supplier, it creates a tremendous amount of risk,” she explains. “The challenge is how to share data, how to create a common set of definitions. The concept of sharing data up and down the supply chain is new, but this kind of transparency is critical to building trust.”

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Tapping new food and beverage markets

Focusing on trust can also open up new markets. In the case of Clearwater, it has been able to use its model of vertical integration to bolster trust across the supply chain.

“Clearwater Seafoods is recognized globally for its ocean-to-plate traceability,” says CEO Ian Smith. In the seafood industry, he explains, fraud is a significant concern—whether it’s tampering with weight measurements, substituting one kind of fish for another or misrepresenting the country of origin.

“Because we’re a vertically integrated company, we can confidently track products from the moment they’re harvested from the ocean right through to our customers’ warehouses and distribution centres.”

Trust has been integral to accessing new and expanding markets like China, where a growing middle class has an appetite for seafood but often has questions about the integrity, source, ingredients and safety of food products. Clearwater has found significant opportunities in meeting these high expectations, including demands for fast delivery of almost any product through e-commerce.

In China, Singles’ Day alone accounts for US$30 billion in sales on just one of the participating e-commerce platforms, and with Canada’s positive reputation for food quality, Canadian companies have a significant opportunity to develop new business there. For those looking to tap those opportunities, partnerships with local companies are very important when it comes to accessing the Chinese market.

How food industry players can build trust by living their values

Marc-Stéphane Pennee, Partner, Assurance and Food and Beverage Leader, Quebec

In today’s food and beverage market, transparency is essential. Consumers want and expect more information about the products they’re buying. Larger companies are also facing uncertainty in the food chain, as well as recall issues, especially around meat and produce. This can affect customer trust not only in a specific product but also in a brand as a whole.

But consumers aren’t always consistent in their behaviours. While they may genuinely want local food, environmental sustainability and ethical practices, some will choose the product that costs less when standing in the grocery aisle comparing two items. Cost remains a significant factor, as does convenience.

Faced with shifting behaviours, how should companies position themselves? It’s important to stay true to their values and then, through their transparency efforts, promote what they stand for. By defining and remaining faithful to their mission and values, companies can help create a foundation of loyal customers for their brand.

Regardless of a company’s size, it’s also important to set the tone at the top. The bigger the company, the more challenging this may be. But if a company instills the right tone at the executive and senior levels, it should be possible to replicate those actions throughout the organization and bring those values to life through the company’s day-to-day activities.

The bottom line:

Build trust by highlighting what you’re doing and making sure you’re following through.


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