Advantages of traceability in logistics


As you well know, supply chain traceability is the ability to identify and track the entire chain of movement of any product, at any stage, as it changes hands on the way to the end consumer.

That's right! It includes everything from the raw material source to various indirect suppliers, through the manufacturing process to the retailer. As such, traceability allows organizations to obtain accurate information on origin, practices, processes and other variables in detail.

However, even after the digitization of the supply chain, very few companies, usually niche players, currently have the technology in place to achieve the level of traceability needed to update their business logistics.

Thus, in this note we will tell you why traceability is important for your business, what is traceability as a competitive advantage and what are its advantages.

Why is logistics traceability important?

Initially, traceability became necessary due to regulations, especially in industries such as food and beverage, where compliance standards were becoming extremely stringent.

And, in a global supply chain, with different regulatory requirements at various points along the chain, regulatory compliance becomes much easier if you have product traceability software like Drivin.

According to the Supply Chain Brain blog, traceability components is also invaluable in outage management, especially when using historical data and algorithms to predict where delays are likely, where oversight is needed, and what steps should be taken to mitigate specific risks.

It also supports an increasingly important goal of supply chains worldwide: sustainability. Businesses and consumers want to know that the products they buy are sustainably sourced: where they come from and what kinds of practices and processes are involved in the choices they make.

It also lays the groundwork for sustainable practices such as recycling at scale and establishing a circular economy. Some companies have already begun to make transparency in their supply chain a logistics strategy, validating the market's preference for responsibly grown and ethically sourced products.

What is logistics traceability as a competitive advantage?

The real-time information provided by a traceability software is very useful for organizations, since when they handle a large volume of packages per day that must be distributed in different directions, having a logistics traceability system to know the traced route means a huge competitive advantage.

However, it is the customer who also needs a company's visibility and traceability information. In times of pandemic, logistics services have added new customers. They are no longer "business customers", i.e. customer-suppliers who sent parcels to a sales center with which they had a business relationship.

Today, thanks to platforms such as marketplaces, new types of customers are entering the market who demand full traceability of their products.

But with online activity and the presence of marketplaces and offers, today's customer is more informed, and at the same time, logistics agents can not only provide limited product information to customers, but customers have every right to request to track their deliveries and have more information about the shipment.

Advantages of logistics traceability

Achieving a logistics traceability system means establishing a direct correspondence between the physical flow of goods and the flow of information linked to it. Therefore, traceability brings several advantages, among which the following stand out:

1. Increased productivity in companies

It helps to identify critical points along the supply chain to mitigate incidents and increase productivity. This traceability system allows solving problems related to mishandling of products, increasing the quality of delivery to the customer.

2. Improves consumer confidence

To the extent that customers know sufficient and fairly accurate information about the delivery time of a product, where it is and how long it will take to reach their hands, confidence in the logistics service is greater, which will allow future customer repurchases.

With the widespread adherence to e-commerce, merchandise traceability has come to the forefront, as it reduces the uncertainty that many consumers experience regarding the shipment of products.

Conclusion

Finally, to achieve traceability in logistics, companies must first identify the exact outcome they expect from the company. Companies often adopt traceability technology to facilitate greater regulatory compliance, improve reliability and sustainability, enhance customer engagement, create a more resilient logistics chain, and insulate themselves from risk.

But more than simply acquiring a new technology platform like Drivin, traceability offers companies the opportunity to move toward a new business model based on full operational transparency.

Moving toward the highest level of traceability is more than a strategic decision that optimizes growth. It is a new value system that could transform the supply chain for a future that is good for business, consumers and the planet.

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