Supply chain traceability: Everything you need to know!

With the EU’s Digital Product Passport (DPP), businesses are under growing pressure to enhance traceability within their supply chains. At the same time, consumers are demanding greater transparency about the products they purchase.

In this article, we will explore what supply chain traceability is, including its importance, benefits, and challenges.

What is supply chain traceability?

The definition of supply chain traceability refers to being able to track where products and materials come from and how they move through the supply chain—from raw materials to the final product. This involves collecting and analyzing data at every step to make sure products are made safely, ethically, and sustainably.

The main goal of traceability is to improve transparency and accountability, helping businesses reduce risks, cut waste, and ensure product safety. With better tracking, companies can run their supply chains more smoothly while also meeting increasing demands from both consumers and regulators for responsible and sustainable production.

Example: Food supply chain traceability

Imagine you buy a jar of strawberry jam at the supermarket. How do you know where the strawberries came from, how they were processed, and if they are safe to eat? This is where food supply chain traceability comes in.

1. Farm – The strawberries are grown on a farm and harvested. Each batch is recorded with details like date, location, and farming methods.

2. Processing – The strawberries are transported to a factory, where they are cleaned, cooked, and turned into jam. The factory logs which strawberries were used and when.

3. Packaging and distribution – The jam is packaged, labeled with a batch number, and sent to warehouses or stores.

4. Retail and consumer – When you buy the jam, the batch number allows companies to trace it back to its origin if there’s a problem – like contamination.

   
   

Digital Product Passport: Enhancing supply chain traceability

The Digital Product Passport (DPP) is a part of the EU Green Deal, aimed at reducing environmental impact and ensuring sustainable production. It supports supply chain traceability by providing digital records that track a product’s journey. 

Let’s look at an example: Scanning a DPP-linked QR code on a jar of strawberry jam could show where the strawberries were grown, how they were processed, and if the packaging is recyclable. This boosts consumer trust, improves efficiency, and reduces waste, making DPPs a valuable tool for responsible production.

Why is supply chain traceability important?

To better understand the importance of supply chain traceability, let's go through six benefits your businesses gain by implementing it:

1. Greater visibility – Track products and materials at every stage for better control and decision-making.

2. Improved risk management – Quickly identify and address issues like recalls, fraud, or disruptions.

3. Enhanced sustainability – Ensure ethical sourcing, responsible production, and regulatory compliance.

4. Reduced waste – Optimize resources, minimize overproduction, and support the circular economy.

5. Increased efficiency – Streamline operations, reduce delays, and improve overall supply chain performance.

6. Stronger customer trust & brand reputation – Provide transparency, meet consumer expectations, and strengthen brand loyalty.

   
   

What is the difference between traceability and visibility?

With so many terms related to tracking products in the supply chain, it’s easy to wonder: What’s the difference between visibility and traceability? While they sound similar, they serve different purposes. Here’s a closer look at the differences.

• Supply chain visibility is like having a live map of where products and materials are at every step of the supply chain. Businesses can see what’s in production, what’s in storage, and what’s being shipped in real-time. This helps with better planning, avoiding delays, and making smarter decisions.

• Supply chain traceability is like having a product’s history book. It tells us where something comes from, how it was made, and where it has been. By using barcodes, serial numbers, or RFID tags, companies can track a product from raw materials to the final customer. This is especially important in industries like food and medicine, where safety and quality control are key.

Related concepts

To fully understand supply chain traceability, it's helpful to look at other related concepts like supply chain mapping and supply chain transparency—all of which play a role in making supply chains more efficient, sustainable, and accountable.

• Supply chain mapping

Supply chain mapping is like creating a map of all the suppliers involved in making a product. Instead of tracking individual shipments, it shows who is part of the supply chain at different levels. This helps businesses understand their supply network.

• Supply chain transparency

Supply chain transparency is about deciding what information to share and with whom—whether it's suppliers, customers, or regulators. Supply chain transparency makes the supply chain more open and trustworthy. 

How can traceability be improved in the supply chain?

One of the best ways to improve traceability in supply chains is by implementing Digital Product Passports (DPPs). By using DPPs, businesses can track products more efficiently, follow regulations, and promote sustainability. Let’s discover how implementing DPPs can strengthen your traceability.

How Digital Product Passport improves traceability:

1. Complete product information

DPPs collect detailed data on materials, components, and chemicals used in a product. They also store information on repairability, spare parts, and proper disposal—helping companies and consumers make informed choices.

2. Meeting regulations

New EU rules, like the Ecodesign Sustainable Product Regulation (ESPR), will soon require companies to make products more durable, reusable, and recyclable. DPPs help businesses meet these rules while improving traceability.

3. Building consumer trust

With a DPP, customers and business partners can see a product’s entire lifecycle, from raw materials to disposal. This transparency builds trust, encourages sustainability, and helps consumers make responsible choices.

Take the first step to supply chain traceability today!

Be proactive and get ahead in Digital Product Passport (DPP) implementation. Our expert-led training programs will equip your company with the knowledge and tools needed to enhance traceability, compliance, and sustainability. Join our community and let us help you create a smarter, more transparent, and traceable supply chain!

Stay ahead of the curve—explore the Digital Product Passport timeline to see when DPP will be launched and how it will impact your industry.