The Technology of Traceability: Analyzing the Verdantix Smart Innovators Report

The need for product traceability right from the point of a product’s origin, particularly in the cotton and fashion sector, is reaching critical mass. However, with many options for companies to choose from in today’s environment, choosing the right partner for your business can be challenging.

Verdantix, one of the world’s leading industry analysts and a trusted source of information for global businesses, have highlighted this in the release of their new report, ‘Smart Innovators: Sustainable Product and Materials Traceability Software’.

Oritain’s feature in this report is a significant endorsement and helps business leaders in compliance, sustainability, and responsible sourcing to compare and evaluate different, and sometimes unique, supply chain traceability software tools.

Oritain’s market leading origin verification and scientific traceability have been recognized for Market Leading Functionality for Product Identification and Out of the Box Functionality for Document Collection and Management.

Background: A tightening risk and regulatory environment

The growth we have seen in both the importance of traceability and the number of tools available to support it is down to several factors.

The Smart Innovators report identifies regulation as a key driver of traceability and origin verification solution adoption. It says, “The heightened regulatory space has expedited the need for organizations to understand the more granular risks associated with their products and upstream supply chains.”

Regulations around the world, including the US Uyghur Forced Labor Prevention Act (UFLPA), Canada’s forced labor law, the EU ban on forced labor, and the EU Deforestation Regulation will all have an ongoing impact on the need for detailed traceability and origin verification of products and raw materials.

According to US Customs and Border Protection, over 40% of all shipments examined, worth over $800 million, have already been denied entry to the United States since the introduction of the UFLPA. That figure rises to 62% when we look at fashion, apparel, and textiles specifically.

But it is not just regulation – consumers and investors are increasingly holding businesses to account. 76% of consumers say they would stop buying from firms that neglect environmental, employee, or community wellbeing with 89% of investors taking ESG factors into account in their investment decisions.

Sustainable product and materials traceability software can provide key information for compliance requirements, as part of an effective risk management and due diligence system.

Verdantix Smart Innovators report

Findings: Highlights from the Verdantix report

The Verdantix Smart Innovators report provides a high-level benchmark of 21 traceability solutions for products and materials and identifies both core competencies and more specialized capabilities, catering to organizations with specific needs. What is immediately clear is that different supply chain traceability software tools have different strengths – and drawbacks.

These are summarized in a matrix which shows how the business needs and required functionality for a brand seeking product and material level proof of origin for UFLPA compliance can be quite different from another needing compliance with the EU Deforestation Regulation.

We are proud that Oritain has been recognized for market-leading product and material identification and significant out-of-the-box functionality for data collection and management.

This is significant, as without understanding where their products and raw materials truly originate from, businesses cannot have full trust in the integrity of what they are selling to the market.

That is why Oritain’s vision to be the source of truth in global supply chains has never been more critical.

Due diligence regulations are driving software adoption, with requirements for data such as proof of origin for products and materials.

Verdantix Smart Innovators report

The report recognizes that a key differentiating factor in vendor’s offerings is through innovation, and Oritain is an acknowledged pioneer in the field of forensic origin verification.

We have established a unique methodology that marries forensic and data science to set the standard for scientific traceability in the industry, from the point of origin at the raw material stage right through to the finished product. We have spent the better part of a decade mapping the world’s cotton production, giving us unique capabilities for testing and verifying cotton origin.

Now we can take a sample of cotton, coffee, red meat, and other commodities from throughout the supply chain and verify with scientific precision where it originates. That is innovation.

A key section of the report is attributed to the value of combining physical traceability with digital tools to deliver greater certainty.

SUPIMA, a leading US cotton brand and partner of Oritain, combine our origin verification and scientific traceability with an entirely digital platform. Oritain’s scientific testing analyses product compositions to verify consistency with claimed origin and reveal areas of inconsistency, the data from which is then hosted and cross-referenced in SUPIMA’s database.

This reinforces one of the findings from Verdantix – that different tools have different strengths, and the combination of complementary tools can provide a greater level of transparency and traceability than one tool alone.

Combining digital traceability with the physical verification of materials can create added trust in authenticity and the origins of materials.

Verdantix Smart Innovators report

Analysis: The importance of origin in traceability

The Smart Innovators report from Verdantix is an invaluable resource and comes at a moment of increased scrutiny of product sustainability and authenticity.

In navigating the findings and evaluating potential supply chain traceability software, my advice to businesses is to be completely clear about your objectives. What does your business need? What is the problem you are trying to solve?

In my communications with business leaders around the world, we often hear that documentation and digital paper trails used in current systems are sufficient to prove product traceability. However, this is a black hole that can open businesses up to huge risk. Supplier declarations can be falsified, information can be inaccurate or incomplete, human error can compromise data integrity.

Digital traceability through the mapping of transaction history and production processes is accurate so long as the documentation that supports the materials is correct. In many instances, this relies on elements of self-declaration by suppliers.

Verdantix Smart Innovators report

Product fraud, substitution, adulteration, and transshipments, where products can be shipped out of risk origins, into regions deemed to be ‘safe’ from prohibited regions, and then to their end destinations, can happen at any point and are undetectable – until they are detained at the border. Detention leaves businesses staring down the barrel of lost revenue, fines, and reputational damage.

Scientific origin verification through Oritain removes all doubt and ensures products are what they actually claim to be – delivering reassurance to regulators, consumers, investors, and the business itself.

When it comes to product traceability, origin verification is not only integral, it is essential.