Lux Research Identifies Opportunities Beyond Regulatory Compliance in Food Traceability and Transparency
Evaluation of macro forces and discussions with stakeholders about unmet needs give shape to the future of traceability and transparency in food
BOSTON, Sept. 16, 2021
BOSTON, Sept. 16, 2021 /PRNewswire/ -- Political, economic, social, and technological factors are all elevating the need for end-to-end food traceability and transparency, and the COVID-19 pandemic served as a force multiplier, according to new insight from Lux Research, a leading provider of tech-enabled research and innovation advisory services. While there is an abundance of reasons for agrifood companies to implement traceability and transparency tools, understanding the value of doing so is nontrivial.
Lux's new report, "Demystifying Food Traceability and Transparency," seeks to provide much-needed clarity to the murky subject of the value of implementing traceability and transparency tools for agrifood companies. To develop a better sense of what is driving food traceability, Lux evaluated different macro forces that are promoting adoption: political, economic, social, and technological (PEST). Then Lux clearly categorized the qualitative and quantitative outcomes of food traceability projects and created a hot spot map of these outcomes among the 41 traceability projects analyzed. Further, Lux identified the unmet needs in the incumbent traceability activities and emerging technology solutions and their developers and laid out the future directions of this space.
"Among the food traceability drivers from political, economic, social, and technological angles, regulation bears the most weight. That being said, opportunities exist beyond simple compliance and provide real business benefits," explains Jerrold Wang, Analyst on the Lux Research Emerging Ecosystems of Agrifood and Health team and the lead author of the report. "Measuring a tangible, quantitative ROI remains difficult; however, the downside of failing to embrace food traceability, especially given tightening regulations, currently outweighs the unclear upside."
Lux conducted interviews with agrifood stakeholders, and, looking beyond the status quo, these interviews revealed three major unmet needs when it comes to bolstering the value derived from food traceability:
- Sustainability measurements – Measuring indicators of sustainability is now critical to corporate reporting. With increased supply chain connectivity, accurate and granular data is requisite. This is an urgent and complex challenge. Sustainability indicators are difficult to measure and suffer from a lack of standardization.
- Supply and demand forecasting – The COVID-19 pandemic demonstrated food system fragility to disruptive shock. Ideally, layering predictive analytics around traceability data improves forecasts of supply and demand and balances the gap between them. Building resiliency requires improved inventory management to resist likely future perturbation.
- Trade facilitation – COVID-19 forced countries to reexamine local food security, but cross-border trade remained an economic lifeline for many regions. There is a need to optimize food supply chains when sudden, unpredictable perturbations occur. Global trade will require innovations that rapidly resolve disputes amid a growing frequency of supply chain disruptions.
Technology developers will work in earnest to capitalize on the unmet needs expressed by agrifood stakeholders, but a "one-platform-fits-all" approach is not viable, despite being the state of the art. With companies inevitably forced to utilize different platforms, platform interoperability is critical to achieving the long-desired "network effect" in food traceability. Agrifood companies should be active participants in forming consortia with suppliers, customers, tech developers, and standardization organizations to test and validate platform interoperability and metrics. Download the report executive summary to learn more.
About Lux Research
Lux Research is a leading provider of tech-enabled research and advisory services, helping clients drive growth through technology innovation. A pioneer in the research industry, Lux uniquely combines technical expertise and business insights with a proprietary intelligence platform, using advanced analytics and data science to surface true leading indicators. With quality data derived from primary research, fact-based analysis, and opinions that challenge traditional thinking, Lux empowers clients to make more informed decisions today to ensure future success.
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SOURCE Lux Research