Sustainability Atlas
Climate Tech & Data·14 min read··...

Interview: the builder's playbook for Supply chain traceability & product data — hard-earned lessons

A practitioner conversation: what surprised them, what failed, and what they'd do differently. Focus on unit economics, adoption blockers, and what decision-makers should watch next.

Only 9% of organizations comply with new environmental and human rights supply chain regulations, while 72% of manufacturers have adopted traceability software in at least one raw-material flow. This stark gap between regulatory ambition and operational reality defines the central challenge for sustainability leads in 2025. We spoke with practitioners who have built, scaled, and sometimes failed at supply chain traceability implementations to understand what actually works—and what they wish they had known before committing millions to digital transformation.

The global supply chain traceability market reached $7.4 billion in 2024 and is projected to grow to $31.1 billion by 2033, representing a 17.2% compound annual growth rate. But beneath these headline figures lies a more nuanced story: 58% of companies remain stuck in the early stages of their traceability journey, with only 15% successfully capturing value at scale. Here is what builders have learned on the front lines.

Why It Matters

Supply chain transparency has shifted from a corporate social responsibility initiative to an existential compliance requirement. The EU Deforestation Regulation (EUDR), effective December 2024, imposes penalties of up to 4% of annual EU revenue for non-compliant imports of cattle, cocoa, coffee, palm oil, rubber, soy, and timber. The EU Digital Product Passport (DPP) regulation under the Ecodesign for Sustainable Products Regulation (ESPR) came into force in July 2024, requiring digital records for nearly all products sold in the EU—starting with batteries in February 2027 and textiles by mid-2027.

For sustainability leads, the business case extends beyond avoiding fines. Companies with mature traceability systems can identify contamination sources in seconds rather than days, execute surgical recalls instead of industry-wide shutdowns, and demonstrate provenance claims that command consumer premiums—64% of global consumers now express willingness to pay more for traceable products.

The question facing decision-makers is no longer whether to invest in traceability, but how to build systems that actually work across multi-tier supply chains involving hundreds or thousands of suppliers with varying technical capabilities.

Key Concepts

Product-Level vs. Batch-Level Traceability

The granularity of traceability determines both implementation cost and value capture. Batch-level tracking (assigning identifiers to production lots) provides sufficient resolution for most recall scenarios and regulatory compliance. Item-level serialisation (unique identifiers for every unit) enables authentication, circular economy loops, and consumer engagement but multiplies data management complexity exponentially.

"We started with item-level ambitions and quickly realised our suppliers could not maintain that granularity consistently," explains a supply chain director at a major consumer goods manufacturer. "Batch-level with robust lot segregation gave us 90% of the compliance value at 30% of the integration cost."

Interoperability Standards

The supply chain traceability ecosystem lacks a single dominant standard, creating integration friction. GS1 EPCIS (Electronic Product Code Information Services) provides event-based tracking vocabulary used by Walmart, Carrefour, and major pharmaceutical companies. ISO 22005 defines general principles for food traceability. The emerging EU DPP will require specific data attributes including unique identifiers, manufacturer information, materials composition, environmental impact metrics, and end-of-life guidance.

Practitioners consistently emphasise that standard selection matters less than consistent implementation across the supply base. "We spent six months debating which standard to adopt," recalls a sustainability technology lead. "We should have spent that time getting our top 50 suppliers to share any structured data at all."

The Supplier Adoption Challenge

The most sophisticated traceability platform delivers zero value if suppliers refuse to participate. In 2024, 33% of suppliers declined to share full batch-level information, creating systematic gaps in traceability coverage. The reasons vary: concerns about competitive intelligence exposure, lack of technical infrastructure, unclear ROI, and distrust of data-sharing arrangements.

Successful implementations treat supplier onboarding as a relationship-building exercise rather than a compliance mandate. Education programmes, co-investment in technology infrastructure, and demonstrated mutual benefits—reduced audit burden, preferential supplier status, access to premium markets—prove more effective than contractual requirements alone.

What's Working

Walmart-IBM Food Trust Blockchain

Walmart's partnership with IBM, launched in 2016 and expanded through mandated supplier adoption by 2019, demonstrates that enterprise-scale traceability is achievable. The system reduced mango traceability time from 6 days, 18 hours, and 26 minutes to 2.2 seconds—a 99.9% improvement. By 2024, over 300 suppliers and buyers participate in the IBM Food Trust consortium, tracking products across multiple categories.

The key success factors were not technological but organisational: Walmart used its buyer power to mandate participation, invested in supplier education and onboarding support, and created a consortium model (including Nestlé, Unilever, Kroger, and Tyson Foods) that distributed implementation costs and established network effects.

"The blockchain itself was less important than the forcing function of mandatory participation," observes an industry analyst familiar with the programme. "Walmart said: if you want to sell leafy greens to us, you must upload harvest, processing, and shipping data. That clarity drove adoption."

EU Battery Passport Pilot

The EU Battery Regulation (2023/1542) requires Digital Product Passports for all industrial and electric vehicle batteries from February 2027. The Global Battery Alliance's Battery Passport pilot, launched in 2024, demonstrated practical implementation across the full battery value chain—from raw material extraction through manufacturing to end-of-life recycling.

The pilot established that critical data attributes (carbon footprint, recycled content, supply chain due diligence, state of health) can be captured and transmitted across organisational boundaries using standardised data carriers (QR codes, NFC tags). Participating companies including Volkswagen, BMW, and CATL gained early implementation experience that positions them ahead of competitors as mandatory requirements approach.

Carrefour's Consumer-Facing Transparency

French retailer Carrefour implemented blockchain-based traceability for over 40 product lines, enabling consumers to scan QR codes and access complete supply chain information including farm locations, production dates, and quality certifications. The programme demonstrated consumer appetite for transparency—scanned products showed measurably higher sales velocity in A/B testing.

Critically, Carrefour invested in translating complex supply chain data into consumer-friendly formats. "Technical traceability is necessary but not sufficient," notes a retail technology consultant. "Consumers do not want blockchain proofs. They want simple answers: where did this come from, was it produced responsibly, can I trust this claim?"

What's Not Working

Pilot Purgatory

The most common failure mode is not implementation failure but scaling failure. Bain & Company research in 2024 found that most traceability initiatives get stuck in pilot mode, unable to transition from proof-of-concept demonstrations to enterprise-wide deployment. The causes are predictable: unclear governance, insufficient budget for scaling, pilot teams that dissolve after initial success, and lack of integration with core business systems.

"We ran a beautiful pilot with 12 suppliers and 3 product lines," recalls a sustainability director at a fashion brand. "Then the project lead left, budget was cut, and the platform sat unused for 18 months. We essentially paid for expensive PowerPoint slides."

Practitioners recommend planning for scale from day one: secure multi-year budget commitments, integrate with existing ERP and supply chain management systems, establish clear ownership and governance structures, and define success metrics that matter to business stakeholders beyond the sustainability function.

Maersk-IBM TradeLens Shutdown

The 2022 discontinuation of TradeLens—the Maersk-IBM blockchain platform for shipping documentation—illustrates the risks of consortium approaches when network effects fail to materialise. Despite backing from two industry giants and participation from multiple container lines, TradeLens could not achieve the critical mass required for viability. Competing carriers were reluctant to join a platform perceived as advantaging its founders.

The lesson for traceability builders is that technology neutrality and governance structure matter enormously. Platforms must provide demonstrable value to all participants—including competitors—and governance arrangements must prevent any single actor from capturing disproportionate benefits or controlling access.

Small Supplier Exclusion

High implementation costs and technical complexity systematically exclude small and medium enterprises from traceability systems. Research indicates that 67% of SMEs cite implementation costs as prohibitive barriers. When traceability requirements exclude smaller suppliers, companies face difficult choices: abandon long-standing supplier relationships, accept traceability gaps, or invest in supplier capability building at their own expense.

The EU Digital Product Passport regulations acknowledge this challenge by providing extended transition periods and phased requirements for smaller actors. But practitioners emphasise that the fundamental tension remains unresolved: comprehensive traceability requires participation from suppliers at every tier, yet the smallest actors often lack resources to participate.

Key Players

Established Leaders

  • IBM Food Trust — Enterprise blockchain platform for food supply chain transparency. Powers Walmart, Carrefour, and Nestlé implementations with 300+ ecosystem participants tracking products across manufacturing, distribution, and retail.

  • SAP — Supply chain management giant with integrated traceability modules. December 2024 partnership with Alibaba expands blockchain capabilities for cross-border trade. Serves 77% of global transaction revenue through SAP systems.

  • Oracle — Enterprise software provider with December 2024 acquisition of Overhaul for real-time supply chain tracking. Integrates traceability with logistics visibility across transportation and warehousing.

  • VeChain — Shanghai-based blockchain platform for supply chain traceability. Partners with Walmart China (100+ product lines), Renault, BMW, and PwC. Market capitalisation of $2-3 billion with public token (VET).

Emerging Startups

  • Circularise — Netherlands-based platform for Digital Product Passport compliance. Specialises in chemicals and plastics supply chain transparency using blockchain and zero-knowledge proofs for data privacy.

  • TrusTrace — Swedish traceability platform for fashion and textiles. Provides supply chain mapping, material verification, and DPP readiness for brands including H&M and Kering.

  • Provenance — UK-based transparency platform enabling brands to share verified product claims with consumers. Works across food, beauty, and fashion sectors with focus on sustainability storytelling.

  • OriginTrail — Slovenian Decentralised Knowledge Graph protocol for multi-chain interoperability. Focus on food and pharmaceutical traceability with growing enterprise adoption.

Key Investors & Funders

  • Breakthrough Energy Ventures — Bill Gates-backed fund with investments in supply chain digitalisation and climate data infrastructure.

  • European Investment Bank — Major funder of supply chain transparency initiatives through digital innovation and sustainability programmes.

  • EU Innovation Fund — Supports Digital Product Passport pilots and supply chain traceability infrastructure development.

  • Sequoia Capital — Investments in supply chain visibility platforms including Project44 ($818M raised) and logistics technology.

Action Checklist

  1. Audit current traceability maturity: Map existing data flows across your top 50 suppliers by volume. Identify which tiers have structured data sharing, which require manual collection, and which represent complete blind spots.

  2. Prioritise regulatory exposure: Cross-reference product categories against upcoming DPP requirements (batteries February 2027, textiles mid-2027) and EUDR commodity coverage. Build implementation roadmaps that front-load highest-exposure categories.

  3. Select technology partners with interoperability focus: Evaluate platforms based on adherence to GS1 EPCIS standards, API accessibility, and demonstrated multi-enterprise deployments. Avoid proprietary lock-in that complicates future integration.

  4. Design supplier onboarding programmes: Create tiered support packages matching supplier capabilities—from API integration for sophisticated partners to mobile-first data entry for small producers. Budget for education, training, and technical assistance.

  5. Establish governance structures: Define data ownership, access rights, liability for errors, and dispute resolution mechanisms before implementation. Document agreements in supplier contracts with clear escalation paths.

  6. Integrate with existing systems: Connect traceability platforms to ERP, procurement, and sustainability reporting systems. Standalone platforms that require manual data reconciliation will not scale.

  7. Define consumer-facing applications: Determine how traceability data will reach end consumers—QR codes on packaging, website product pages, third-party certification marks—and design data presentation for non-technical audiences.

  8. Plan for scale from day one: Secure multi-year budget commitments, assign permanent ownership beyond pilot teams, and establish success metrics aligned with business objectives (recall cost reduction, audit efficiency, premium pricing capture) rather than technical deployment milestones.

FAQ

Q: What is the realistic timeline and budget for implementing supply chain traceability across a multi-tier supply network?

A: Implementation timelines typically range from 8-24 months depending on supply chain complexity and supplier technical maturity. Budget requirements vary significantly: enterprise software licensing runs $100,000-500,000 annually, while implementation consulting, supplier onboarding, and change management add 2-3x the software cost in the first year. Bain research indicates that companies achieving value at scale typically invest $2-5 million over 3-5 years for mid-sized supply networks. The critical budget error is underestimating supplier onboarding costs—expect 60-70% of implementation effort to focus on getting suppliers to participate consistently.

Q: How do we handle suppliers who refuse to share data or lack technical capabilities?

A: Supplier resistance is the norm, not the exception—33% decline to share full batch information. Successful approaches combine carrots and sticks: preferential payment terms, reduced audit burden, and access to premium buyer programmes incentivise participation, while long-term contract requirements and supplier diversification create pressure. For capability-constrained suppliers, consider co-investment in technology infrastructure, mobile-first data capture tools that minimise training requirements, and third-party aggregation services that handle technical complexity. The EU DPP regulations include provisions for data sharing through trusted intermediaries, which may provide models for handling sensitive commercial information.

Q: Should we build traceability systems on blockchain or conventional databases?

A: The blockchain-versus-database debate has largely resolved in favour of pragmatic hybrid approaches. Blockchain provides value for multi-party trust scenarios where no single actor controls the system—as in the IBM Food Trust consortium model. However, blockchain adds complexity and cost that are unnecessary for internal traceability or bilateral supplier relationships. Most enterprise implementations now use conventional databases for operational data management with selective blockchain integration for audit trails, timestamping, and cross-organisational data sharing. The Walmart case demonstrates that the technology choice matters less than the governance and incentive structures that drive participation.

Q: How do we prepare for EU Digital Product Passport requirements if delegated acts have not been published?

A: While specific DPP data attributes await delegated acts (expected Q3-Q4 2025 for textiles and steel), the ESPR framework defines the general structure. Products will require unique identifiers, manufacturer information, materials composition, environmental impact data (carbon footprint, recycled content), compliance documentation, and lifecycle guidance. Companies should centralise product data in Product Information Management (PIM) systems, establish supplier data collection processes for material origins and sustainability metrics, and implement data carriers (QR codes, NFC tags) on packaging. The April 2025 ESPR Working Plan provides additional implementation guidance. Early movers gain competitive advantage by building infrastructure before mandatory deadlines create bottlenecks in implementation capacity.

Q: What ROI metrics should we track to justify continued investment in traceability?

A: Leading organisations track metrics across four categories. Compliance: audit preparation time reduction (typically 40-60% decrease), regulatory penalty avoidance, and certification maintenance costs. Operations: recall scope reduction (surgical versus category-wide), recall response time, and inventory write-off reduction. Commercial: premium pricing capture for verified sustainable products, customer acquisition attributable to transparency, and supplier negotiation leverage. Risk: supply disruption early warning, reputational incident prevention, and insurance cost reduction. The strongest business cases combine quantifiable operational savings (recall cost reduction, audit efficiency) with strategic value (brand differentiation, regulatory preparedness) weighted appropriately for organisational priorities.

Sources

The supply chain traceability imperative represents both a compliance burden and a competitive opportunity. Organisations that build robust data infrastructure, invest in supplier relationships, and design for scale will capture disproportionate value as the $7.4 billion market expands to $31 billion over the next decade. The hard-earned lessons from practitioners are clear: success requires treating traceability as a business transformation initiative rather than a technology project, with sustained investment, cross-functional governance, and relentless focus on supplier participation.

Topics

supplychainmodel riskauditabilityclimate APIsstandardsverification

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