Blockchain technology could bring visibility, efficiency and security


Blockchain remains an obscure concept to many, but experts say the technology could have big implications for grocers and retailers that carry food products by enabling them to better trace the origins of items and more quickly handle recalls. From farms and processing facilities to the shelves of grocery stores, experts say a blockchain-based system could create a reliable and trusted network to share information about food products.

While retailers are continually finding ways to reduce risk and optimize supply chains, food products can be especially challenging because of their perishable nature and potential hazards. The fact that farmers, processors, manufacturers, shipping companies and distributors often use their own reporting systems only adds to the complexity. Even in today’s era of the Internet of Things, cloud-based technology and real-time reporting, it can be difficult for retailers to precisely track the origins of food products.

Data from the Stericycle Recall Index indicates that food product recalls have risen over the past five years, skyrocketing 93 percent since 2012.

That is a big problem, considering that food can be dangerous when it is not handled properly in transit. According to the federal Centers for Disease Control and Prevention, food-borne pathogens such as E. coli, listeria or salmonella are responsible for 48 million illnesses, 128,000 hospitalizations and 3,000 deaths annually. And because contamination or mishandling can occur at any point in the supply chain, it can often be difficult to trace the source.

Data from the Stericycle Recall Index indicates that food product recalls have risen over the past five years, skyrocketing 93 percent since 2012. A survey by the Grocery Manufacturers Association found more than half of companies surveyed were impacted by a food recall in the five years prior.

Peter Mehring, CEO of Zest Labs, says while the United States has a “very trusted” food supply chain, certain parts have less reliable information than others. Seafood has been one area of concern; it can also be challenging to confirm the validity of organic and locally grown products. Even among big brands, seasonal outsourcing of cultivation or manufacturing can lead to inconsistencies.

“Getting product-level visibility is the ultimate goal, but we don’t know many retailers that are getting that today. There are some inconsistencies and overlapping data,” Mehring says. “And while they have trusted partners, you don’t know how reliable that is from day to day.”

‘An immutable record’

Regulators and those in the industry have been working on improving food safety and visibility. The FDA Food Safety Modernization Act of 2011 aimed to shift the focus from response to prevention of food-borne illnesses. It implemented several rules that called for accredited third-party certification, new manufacturing practices, supplier verification programs and higher standards for growing, harvesting and packaging produce.

Experts and industry insiders say blockchain could be a valid infrastructure to support many of those capabilities. Blockchain technology was initially developed to support Bitcoin cryptocurrency but Chris Burruss, president of the Blockchain in Transport Alliance, says there’s a big difference between the two. While regulators and authoritative bodies question the legitimacy of Bitcoin and other cryptocurrencies, the underlying blockchain infrastructure is widely accepted to have beneficial applications in many industries.

“The original blockchain was developed for Bitcoin to have an immutable record of all the transactions,” Burruss says. “It’s really just the system for tracking it, but it’s very effective.”

Unlike traditional centralized systems controlled by one party, blockchain’s “distributed ledger” system stores data in a shared database synchronized across a network hosted at multiple sites by a variety of institutions that constantly verify and update records in the chain. Experts say the combination of transparency and redundancy makes tampering extremely difficult.

Blockchain is a “reliable, trustworthy and secure” way to store and present data, Mehring says. Zest Labs uses the technology on its Zest Fresh platform to create an added layer of trust and security throughout the supply chain.

“Blockchain is a nice technology that we leverage for building a standard interaction for retailers. It’s more important to them than growers and farmers because the further you go down the supply chain, the less trusted the information is,” Mehring says.

Blockchain can take data on an operational basis and in real time, and incorporates the food safety concept of “hazard analysis critical control points” so stakeholders proactively know the food has passed all required tests. In a perfect deployment, blockchain can offer a permanent, tamper-proof record of a product’s entire journey and touchpoints through its entire lifespan, from farm to table.

Zest Labs produced a white paper with ChainLink about blockchain’s role in the produce supply chain. It found that the detailed traceability can offer stronger assurance of origin and chain of custody, faster and more precise recalls, fresher food with less waste and fewer contamination incidents.

The FDA Food Safety Modernization Act of 2011 implemented several rules that called for accredited third-party certification, new manufacturing practices, supplier verification programs and higher standards for growing, harvesting and packaging produce.

The road to adoption

Blockchain is still in its infancy, and it could be at least a few years before widescale adoption in the food supply chain. For such a system to work there will need to be industry-wide collaboration and acceptance of data standards and formats. Blockchain-based technology will also have to be easy for participants to integrate into their own systems, Mehring says.

That could take some time, as executives in many industries still don’t understand the technology or approach it with skepticism. A recent survey by Deloitte found that 39 percent of senior executives have little or no knowledge about blockchain. “It is fair to say that industry is still confused to a degree about the potential for blockchain. … about a third consider the technology overhyped,” says Deloitte Managing Director David Schatsky.

Some large stakeholders are already piloting and testing blockchain programs. In August 2017, Walmart, Nestlé, Kroger, Tyson Foods, Dole and several other consumer product companies worked with IBM to integrate blockchain into their supply chains. (STORES previously wrote about blockchain and food safety in the February/March issue.) Laurence Haziot, global managing director and general manager of consumer industries at IBM, says much as the internet has changed retail in profound ways, so too will blockchain, and even more so in food.

The biggest impact blockchain will make is in reducing what Haziot calls the “multiplicity of information” that comes from fragmented systems throughout the supply chain.

“If you want to trace back, you have to deal with data coming from so many systems. It is completely fragmented today,” Haziot says. “Blockchain could offer one indisputable version of the truth.”

IBM also recently worked with Walmart and ecommerce company in China to show how blockchain could work in a broad-based food safety system. One test followed a package of mangoes through the entire system to the store shelf, and from there they tried to trace it back to its origin. While the old system took six days and 18 hours to trace a product to a particular farm, the blockchain-based system identified the journey and origin in just over two seconds.

“Think about that in a scenario that could be life-threatening,” Haziot says. “If you can trace it back very quickly [and identify]the name of the source, you can save a lot of lives or reduce illnesses.”

A ‘trusted environment’

Blockchain can significantly improve visibility, safety and compliance because it creates a fully “trusted environment” for data, Haziot says. In the blockchain, records are organized chronologically into “blocks” that are then tied together. Records can be accessed by private keys for the owner of that record and with public keys by participants with whom they want to share information. The system is intended to enable the user to have full control of the data while allowing participants to gain access to trusted information and the state of the food for their transactions.

“It’s a huge database that can be safely shared among a huge number of people. They can put in all of their data but only share what they want to,” Haziot says.

IBM is continually seeking new ways in which blockchain can benefit food systems. It has since introduced one of the first fully integrated, enterprise-grade production blockchain platforms for organizations to quickly activate their own networks. The IBM Blockchain Platform is available via the IBM Cloud and builds off the success of work with more than 400 organizations. The platform operates through an open source collaboration in the Hyperledger community and allows multiple parties to jointly develop, govern and operate their own secure blockchain.

Frank Yiannas, vice president of food safety at Walmart, says blockchain technology enables a “new era” of end-to-end transparency in the global food system that will further promote responsible actions and behaviors. “It also allows all participants to share information rapidly and with confidence across a strong trusted network,” Yiannas says. “This is critical to ensuring that the global food system remains safe for all.”

Blockchain’s detailed traceability can offer stronger assurance of origin and chain of custody, faster and more precise recalls, fresher food with less waste and fewer contamination incidents.

Aside from security and visibility, there are many other use cases for blockchain in food supply. It could improve transportation and make it more efficient through “smart contracts,” Burruss says. These smart transactions could initiate when milestones are reached or a product reaches a certain point in the supply chain. That could create an automated system that could verify checkpoints and milestones, giving retailers more insight and security about the supply chain.

“Every event that happens with that truck is right there and out there for everyone to see,” Burruss says. “That can include temperature, provenance, detention time, delivery. It’s all being recorded for everyone and eliminates questions.”

To fuel more widespread adoption, Haziot says it will need to be cost-effective for all parties to join the network. There will also need to be seamless onboarding with software that takes only a minimal amount of internal effort for participants to put their data on the network. IBM is currently working on these issues, Haziot says.
“Retailers will need to take the lead in requiring it,” Mehring says. “Growers feel like they’re usually getting squeezed the most on margin, on the cost of product, and they’re only going to do what’s [minimally]required.”

Craig Guillot is based in New Orleans and writes about retail, real estate, business and personal finance. Read more of his work at

IoT Gains a Foothold in Food Supply Chains

From farm to fork, the Internet of Things has quickly integrated into every link of the food supply chain.


When Internet of Things (IoT) sensors, barcodes, scanners, automation and analytics first began making their way into industry, the vision for the food supply chain was that IoT technology would integrate into virtually every aspect of food operations from farm to fork.

Now it is happening.

On the Farm
To avoid waste in the field, agricultural producers have been focusing on ways to improve crop yields. Part of this effort is being devoted to a relatively new practice: precision agriculture (PA).

Precision agriculture is a farming method that takes into account the variability of soils, pests and crop yields depending on which portion of a field you are working. Because fields vary in terms of soil types, moisture content, contour and crop yield, how you plant corn over an entire area will also have to vary depending on your location in the field.

“To improve yields, producers use grid soil sampling to assist them in dealing with soil variability,” explains Carl Crozier, professor of crop and soil science and extension specialist at North Carolina State University (NCSU). “They take various soil samples from different areas of a field, mark these samples to the locations they were taken from, and then send the samples into the lab for fertilizer and lime recommendations. Once these are available, a map of the field showing their spatial variability must be created to guide precision management.”

The next step is to translate these results into ways that a producer can variably spread different proportions of fertilizers on different areas of a field based on the variability of soil, moisture, topography and so on. To do this efficiently, spreaders and other types of farm equipment now come with software and IoT sensors that can link into the geospatial coordinations of the different locations in the field and adjust the fertilizer mix to fit the individual prescriptions for these locations.

“In the future, we will expand the use of mounted cameras and view fields from above with UAVs (unmanned aerial vehicle),” adds NCSU associate professor of crop and soil sciences Jeff White. “This will aid farmers in detecting anomalies in the fields, such as variances in moisture or color—like when they see a yellow spot in an otherwise green field. Spectral analysis of blue, green, red and near infrared bands can be employed for the detection of nitrogen content and fertilizer need. This will help farmers achieve more granular levels of precision agriculture, so they can begin asking themselves whether they should add more nitrogen to certain areas of their fields.”

Food on the Move
Once the food leaves the farm, it enters into a stream of logistics, which can include warehousing, distribution and delivery to retailers.

“There is much to do in this area, because we’re still seeing 30 percent to 40 percent food waste levels post harvest, and half of this waste is occurring before food even gets to consumers,” says Peter Mehring, CEO of Zest Labs, an AgTech company introducing IoT technology into the post-harvest fresh food supply chain to improve food safety and reduce food waste. Mehring believes that food wholesalers and retailers can improve their profit margins and reduce food waste by 50 percent or more by using more IoT sensors and real-time analytics for food tracking and monitoring.

“Often, companies will attach sensors for tracking and monitoring to pallets, but not to the products themselves,” says Mehring. “What we really want to know is what the temperature and humidity conditions are with respect to the products, not to the ambient conditions of the environment a pallet is in.”

Karl Deily, president of food care at Sealed Air, which provides packaging solutions for foods and other industries, explains how more product-specific monitoring for spoilage prevention in food processing plants can be put into product packaging.

“A load of strawberries might come into a processing plant on the same date from the same field. You would assume that these strawberries would all carry the same expiration date, but there is a big freshness difference between strawberries that are picked in the cool of the early morning and those that are picked later in the day,” explains Deily.

Strawberries picked during cool early morning hours are likely to respirate less than the strawberries picked in the afternoon. “The less the strawberries respirate, the longer they will be fresh,” he adds.

In the processing plant, IoT sensors can monitor fruit respiration rates and freshness so that packaging with more respiratory perforations is prepared for the fruit that is respirating at a higher rate, while fresher fruit that is respirating at a lower rate is wrapped with packaging that contains fewer respiratory perforations.

“This is a way that we can adjust packaging to the conditions of particular products to preserve freshness and reduce spoilage,” says Deily.

From Farm to Fork
Once food arrives at distribution points, it is transported to retailers via truck, rail or plane. IoT plays two major roles in this process:

First, it geographically tracks progress of goods to market, while feeding analytics systems that help determine the safest and speediest routes to market.
Additionnally, it continuously measures the environmentals of the interiors of refrigerated trailers and the interiors of packages and containers that meats and produce are stored. If the seal of a container is broken, or temperature and humidity controls within the container fail, the sensors issue immediate alerts to supply chain managers so the situation can be mitigated. Together, these food track, trace and control mechanisms reduce spoilage and maintain the track and trace of foods from farm to table.

“You want to be able to collect sensor data at the level of the product,” says Mehring. “If a pallet of fruit is not pre-cooled and it is placed into a 34-degree trailer, all of that fruit will be respirating at a higher rate and generating heat, which creates a situation where the fruit will spoil sooner. But if the sensors are actually attached inside the cases with the product, the true temperatures that the products are maintained at can be measured, and you have a much more accurate picture of the state that your cargo is in and how much time you have to get it to market.”

Mehring says that Zest has developed a “ZIPR” (Zest Intelligent Pallet Routing) Code that dynamically calculates the freshness of each pallet tracked. “We use a patented methodology and sensors for this purpose, and the goal is to ensure that the inventory and shipping decisions that supply chain managers make are based on actual food freshness for each and every pallet.”

The ZIPR Code can tell a California producer in an eyeshot whether a product is fresh enough to be shipped across country to Boston, or whether freshness is already reduced and the manager needs to seek out a local market. By working with these predictive analytics, the producer can ship product expediently and effectively—and reduce food waste.

“Food waste is an important part of the food supply chain discussion—not only for producers, transporters and distributors, but for the retailers and consumers themselves,” adds Mehring. “Many of the retailers we work with, for example, expect a 30 percent waste level with lettuce of all different types. They see a harvest date on the lettuce and expect a 10-day shelf life based on this date, but only one third of the lettuce they source makes this date. Most of these retailers tell us that they get an average of 6.5 days shelf life for lettuce, regardless of what the expiration date says. This is where understanding the true ZIPR Code (or remaining freshness of products at harvest) and determining the best destinations to avoid spoilage can make an impact.”

The food freshness journey doesn’t stop at the retailer, however. Today’s smart refrigerators also aid consumers in managing their food freshness and avoiding spoilage. These smart refrigerators can now read everything from a single label on a product, including where the product came from, what ingredients it contains, and what its current freshness is. The refrigerated appliance can even recommend to consumers which foods to eat first in order to avoid waste.

How important is this to today’s consumers?

In a 2016 Trace One survey, 68 percent of consumer respondents said they wanted to know more about what was in their food and where it came from. Food tags and IoT readers and sensors in smart refrigerators help them obtain that information.

Product Recalls
Finally, IoT technology can be a major deterrent to food recalls.

A food recall, whether due to spoilage, contamination or other factors, can have a multi-year or even a permanent effect on a company’s brand and reputation. More importantly, it is a threat to public health.

“Today, when food safety risks could be reduced via end-to-end supply chain visibility, product quality checks must go beyond simply obtaining a certificate of quality analysis at the point of loading,” says Stefan Reidy, CEO of Arviem Switzerland, which provides real-time cargo monitoring and tracking solutions. “When food spoilage and contamination are some of the biggest concerns in food supply chains, visibility should not end with suppliers of raw materials or intermediate goods. Food manufacturers must be able to monitor what’s happening to their shipment while in transit to see whether the goods were transported and stored under proper temperature conditions.”

Unfortunately, not all food manufacturers have adopted IoT to help with this problem, and many small producers and manufacturers lack funds to pursue IoT aggressively. This helped contribute to more than 20 million pounds of food being recalled in the United States in 2017, according to USDA statistics.

Industry executives like Reidy maintain that monitoring goods with IoT sensors during transportation “enables food manufacturers to verify the quality of ingredients before they are incorporated into a product. Moreover, during the times of recalls, traceability of products accelerates the investigation process, enabling professionals to identify the reasons for spoilage or contamination.”

A combination of barcoding and smart labeling technologies; IoT sensors for environmental and food safety factors during transport, yarding and warehousing; and use of cloud-based technology to store and process the results from continuous track and trace of foods can reduce the risk of food spoilage and contamination, improve consumer health, and protect companies from brand and reputation damage—not to mention lawsuits.

Next Steps
“One of the best ways to expand your use of IoT is to become aware of what others in your situation are or have done with it successfully. If you don’t have the expertise, you can also benefit by looking for a vendor that has the right technology and the expertise, and that can be a good business partner,” says Seal Air’s Deily.

Second, when you find an IoT solution that you feel can assist you with food freshness and supply chain issues, trial it first. “The good news about much of this technology is that you can start with a relatively modest investment, and see if it proves out your business case,” explains Mehring.

Third, talk with your suppliers. The end goal of the food supply chain is to give everyone vested in it total visibility of the food it tracks and traces. If you’ve got IoT at your processing plant and in your logistics operations, but you don’t have it at some of your smaller farmer-producers, the links of the supply chain are broken and you don’t have uninterrupted visibility. This is an area where you might be able assist your suppliers with IoT implementation, or possibly even with financing.

Fourth, if you are a retailer, don’t assume that you have to accept food waste at previous levels. “We get called in when a retailer has an acute problem. They already expect to lose points on their margin from food waste,” says Mehring. “But with the growth of IoT and other technologies in the food supply chain, there’s every reason to aim for better results.”

Mary Shacklett is the president of Transworld Data, a technology analytics, market research and consulting firm. Prior to founding the company, she was vice president of product research and software development at Summit Information Systems. She may be reached at

Zest Labs Launches Professional Services to Help Growers and Grocers Innovate the Fresh Food Supply Chain

Company Signs $1.5M Professional Services Agreement with One of the World’s Leading Retailers

San Jose, Calif. – March 5, 2018 Zest Labs, an AgTech company modernizing the post-harvest fresh food supply chain, today announced the launch of its professional services offering. The company also announced that it has signed a $1.5M professional services agreement with one of the world’s largest retailers. Zest Labs is a subsidiary of Ecoark Holdings, Inc. (“Ecoark”) (OTCQX: ZEST).

Zest Labs’ professional service offering addresses three core areas that are critical to improving the fresh food supply chain and reducing waste:

  • Systems Integration and Customization of Quality Control Systems, Warehouse Management Systems (WMS) and Third-party Logistics (3PLs)
  • Evaluation of Current Waste Sources to identify and quantify shrink sources and issues that impact freshness and shelf-life
  • Operational Efficiency Assessments that establish process adherence and equipment/asset utilization metrics and provide improvement strategies

“By assessing all the variables that can impact delivered freshness across the supply chain, we’re able to provide organizations with the right strategies for creating the operational efficiencies necessary to improve product margin and sustainability by reducing food waste,” said Peter Mehring, CEO of Zest Labs.

One of the world’s leading retailers has engaged Zest Labs, after a pilot program, for its unmatched experience designing and implementing freshness management solutions for the cold supply chain that improve food safety and reduce waste. The company’s Zest Fresh solution improves the freshness of produce sold to customers and helps organizations achieve efforts toward zero waste within their operations and throughout their supply chain.

“This agreement is a testament to the innovation and thought leadership exhibited by Zest Labs and the value that post-harvest freshness management solutions provide today’s marketplace,” said Mehring.

The professional services project is expected to be completed this year.


About Zest Labs

Zest Labs is an AgTech company modernizing the post-harvest fresh food supply chain to improve food safety and reduce food waste by 50% or more. Our flagship solution, Zest Fresh, provides autonomous, field-to-shelf visibility for proactive decision making to improve delivered freshness and reduce shrink. Integrated blockchain technology provides true transparency for food safety, product freshness and traceability. Zest Fresh improves profitability and increases customer satisfaction and brand loyalty while promoting sustainability.

To learn more about Zest Labs, please click here. To watch a video about Zest Fresh, please click here.


Forward Looking Statements

This release contains forward-looking statements, including, without limitation, statements concerning the business and possible or assumed future results of operations of Zest Labs; and statements concerning the ability of Zest Labs’ technology to improve delivered quality consistency, significantly reduce perishable food waste, drive sustainability, and increase efficiency in the industry. Our actual results could differ materially from those anticipated in the forward-looking statements for many reasons including: access to growth capital on favorable terms; adverse economic changes affecting markets we serve; competition in our markets and industry segments; our timing and the profitability of entering new markets; greater than expected costs, customer acceptance of our products or difficulties related to our integration of the businesses we may acquire; and other risks and uncertainties as may be detailed from time to time in our public announcements and SEC filings. Although we believe the expectations reflected in the forward-looking statements are reasonable, they relate only to events as of the date on which the statements are made, and our future results, levels of activity, performance or achievements may not meet these expectations. We do not intend to update any of the forward-looking statements after the date of this document to conform these statements to actual results or to changes in our expectations, except as required by law.



Investor Relations:
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Public Relations:
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New AgTech Study Reveals the Primary Impact on the Shelf-Life of Produce


Zest Labs, an AgTech company modernizing the post-harvest fresh food supply chain to improve food safety and reduce food waste, today announced key findings from a recent study of strawberries harvested over a two-month period. The study reveals the significant impact of temperature and handling on fresh produce, and that the impact on shelf life and delivered freshness begins in the field starting when the produce is picked. The findings demonstrate the economic benefits of pallet-level freshness management for growers and retail grocers. The study was conducted by Zest Labs, a wholly-owned subsidiary of Ecoark Holdings, Inc. (ZEST), in August and September of 2017 with strawberries harvested in California.

When produce is harvested, it has a definable shelf-life, also known as its “freshness capacity,” which can vary based on three primary factors; quality at harvest, harvest conditions and product temperature. In the Zest Labs study, the strawberries’ optimum freshness capacity was determined to be 14 days. Using its Zest Fresh™ solution, Zest Labs found that the delivered strawberries had shelf-life variability by as much as 12 days, representing 86 percent of the fruit’s total freshness capacity. Today’s fresh food supply chain does not account for this variability, as it typically relies on date labels for assessing remaining freshness. As a result, the unaccounted for shelf-life variability contributes to a significant portion of the $161 billion fresh food waste problem in the U.S. due to unanticipated early spoilage.

Zest Fresh addresses this challenge by managing the variability in freshness capacity at the pallet level, helping growers and retailers reduce waste and deliver an improved customer experience. Zest Fresh utilizes cloud-based analytics to enable intelligent pallet-routing using the Zest Intelligent Pallet Routing Code (ZIPR Code). The ZIPR Code is dynamically calculated based on the quality at harvest, harvest conditions, and the complete product temperature history since harvest and it enables growers to identify and ship each pallet based on its actual remaining freshness. For example, a pallet with 12 days of remaining freshness could be shipped across country, whereas a pallet with eight days of remaining freshness should be shipped locally. As a result, each retailer receives product with adequate remaining freshness for distribution to the store and sell-through, while still ensuring five days of remaining freshness for the customer. Freshness management based on the ZIPR Code helps reduce early spoilage for consumers, while reducing grower and retailer shrink (combination of waste and markdowns), and increasing profitability.

In the study, wireless IoT sensors were inserted at field harvest in each pallet of berries using the Zest Fresh solution. The tags were then autonomously read at key points through the fresh food supply chain, with final readings taking place at a retail distribution center. At each reading, the ZIPR Code for each pallet was dynamically calculated using AI-based predictive shelf-life analytics. Pallets were then intelligently routed based on their respective ZIPR Codes.

“Many people believe that waste occurs at the end of the fresh food supply chain,” said Peter Mehring, CEO of Zest Labs. “But through this study, we have shown that the primary impact to remaining shelf-life occurs in the first 48 hours. The combination of harvest quality, initial processing and the initial distribution decisions result in significant variability of delivered shelf-life. This variability results in shrink, which typically occurs later in the product shelf life when at the store or consumer level, and leads to lost profits, out-of-stocks and dissatisfied customers. With Zest Fresh and the ZIPR Code, growers and retailers now have insight into the remaining freshness of their produce in real-time to more intelligently route product to prevent waste and ensure happy customers.”

Zest Fresh can be used for all fresh and perishable products in the fresh food supply chain including produce, meats, seafood and dairy. For more information about this study, please email

About Zest Labs
Zest Labs, a subsidiary of Ecoark Holdings, Inc., DBA Zest Technologies™ (ZEST), is an AgTech company modernizing the post-harvest fresh food supply chain to improve food safety and reduce food waste. Our flagship solution, Zest Fresh, provides autonomous, field-to-shelf visibility for proactive decision making to improve delivered freshness and reduce shrink by 50% or more. Integrated blockchain technology provides true transparency for food safety, product freshness and traceability. Zest Fresh improves profitability and increases customer satisfaction and brand loyalty while promoting sustainability.

To learn more about Zest Labs, please click here and follow us on LinkedInTwitter and Facebook. To watch a video about Zest Fresh, please click here.


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Blockchain + IoT: Creating True Transparency Within The Food Supply Chain

Today’s food supply chain landscape is becoming increasingly dynamic. Non-traditional retailers like Amazon are disrupting the grocery business. Consumers are increasingly interested and invested in where their food comes from. Manufacturers are as much responsible for the quality of food as growers are. But one thing about the fresh food supply chain has remained consistent: mistakes in the handling or distribution of food — resulting in recalls or foodborne illness outbreaks — have the potential to irreparably damage brand reputation and the bottom line.

Can new technologies help?

To date, there has been limited technological innovation with the potential to transform how retailers and manufacturers deal with recalls or outbreaks. For the most part, dealing with foodborne illnesses and safety recalls has simply been reactive. When an issue occurs, you try to deal with it as best as you can, but the costs — including the time and resources spent trying to figure out where the outbreak or mishandling stemmed from, the collateral damage (i.e. food waste) of recalling products that aren’t contaminated and the brand/customer loyalty fallout that often follows — can batter your bottom line.

The Transparency Challenge

The CDC estimates that 48 million people get sick, 128,000 are hospitalized and 3,000 die from foodborne diseases each year in the United States. And, according to the USDA, nearly 60 million pounds of food was recalled in 2016 alone. That’s a lot. But the history of food, in addition to the increase in food safety and quality regulations, gives us an indication of how we got to this point.

Consumers’ eating habits have drastically changed throughout the years, and with those habits brings new consumer demands and expectations. Traditionally, fresh food was grown, harvested and eaten all in a highly local environment. Now, thanks to consumer demands for having year-round availability of their favorite foods — particularly produce — our food supply chains span thousands of miles, meaning multiple days of handling starting from the growers and suppliers through to the grocery stores.

With this new reality, and the increase in players along the supply chain, transparency has become both incredibly difficult and increasingly important. While there are efforts to move back to a “farm-to-table” mentality, today’s supply chain still includes multiple manufacturing and shipping partners in between the farm and the consumer. The more food changes hands, the greater chance of mishandling, temperature discrepancies and more — all of which increase the risk for foodborne illness outbreaks and major food recalls.

If manufacturers and retailers had the tools to achieve “true transparency” throughout the entire fresh food supply chain, along with access to every link in the chain, everyone involved (including consumers) could have complete visibility into where food has been and if it has been handled and distributed correctly.

What if there was a way to enable food manufacturers and retailers to more quickly and accurately identify the source or sources of contamination? Further, what if there was the potential to improve delivered freshness and more easily identify problems before a product reached the consumer?

Achieving True Transparency with Blockchain and IoT

A foodborne illness outbreak or recall can be a manufacturer’s or retailer’s worst nightmare. But implementing a proactive solution for managing food safety — instead of relying on reactive responses — is easier than most would think, thanks to technology that exists today.

The first step in achieving true transparency is being able to gather the right data about the product at the pallet level. Studies have shown that the pallet is where variation occurs, not at the lot or trailer level. And, what’s important is monitoring the condition of the product, not the components of the supply chain such as the temperature of the pre-cooler or trailer.

We need to start in the field with the product at harvest, and then track its temperature and time throughout the supply chain. Did the broccoli sit out in the sun for multiple hours at the pack house, causing the chances of pathogen growth to increase? Was the cut/bagged lettuce washed and tested? We need to know its processing. Finally, we need to know the logistics at the distribution center and where the produce was shipped to. Implementing IoT sensors at the pallet level, and automatically collecting its data along every step of the supply chain from harvest or production through to the retailer is critical.

The second step for true transparency then becomes: what do manufacturers and retailers do with that data? Of course, there is immense value in collecting quality-focused data on its own, but blockchain is emerging as an important enabling technology to take IoT data and make it completely transparent, delivering security and trust across the supply chain. Blockchain takes the concept of a transaction ledger and brings it into the digital age through a continuous list of records (otherwise known as blocks) linked together and secured using cryptography. From a food quality and safety perspective, blockchain makes it easier to track a product’s journey through the supply chain and log data points about key safety and quality information at every stage.

Blockchain can enable us to be proactively notified of non-compliant product through smart contracts, and include pointers to relevant data about each pallet of product. Through the combination of blockchain and the data collected from IoT sensors, growers, distributors and retailers will be able to automate decisions through smart contracts to address food safety issues, identify and implement solutions for recurring problems, and — in the case of foodborne illnesses or recalls — proactively identify and remove products that are at elevated risk of contamination based on handling history. This means that manufacturers and retailers have the potential to eliminate products at risk before they even reach the consumer, reducing the issues that come from issuing a recall — including cost, consumer safety, damaged brand reputations and decreased customer loyalty.

While there isn’t a silver bullet when it comes to eliminating foodborne illnesses or contamination recalls, by implementing a solution using IoT and blockchain technologies in tandem, growers, processors and retailers have the potential to more efficiently track produce handling and quality, and make educated, proactive decisions about what food should (and shouldn’t) make it into consumers’ homes.

True transparency is the key to not only becoming a trusted partner in today’s dynamic food supply chain industry, but also meeting increasingly high consumer demands. The right application of IoT and blockchain can transform the supply chain, enabling manufacturers and retailers to have a shot at succeeding at both.