Blockchain-based traceability for the Food & Beverage sector. The QR code deception

12 Oct, 2020

Nowadays, when it comes to produce and sell food and beverages, traceability represents a fundamental requirement. Before becoming an advertising stunt, we must say that the “ability” to “trace” food along the supply chain till the point of sale is mandatory by law. However, following product’s path from the production site to the shelves of the supermarket is not enough. As a safety measure, it must be possible to track an item, going back to the origin of the raw materials used in its production. With different rates of precision, this is required for all food products, as it allows potential recalls, market withdrawals and safety alerts.

In addition, there is supplementary information to the one imposed by law that can be transmitted to the end-users. This has the scope of differentiating companies’ offers, bringing them to compete not just on price, but also on quality, environmental sustainability, typicality etc. To communicate it successfully, a guarantee and a proof of authenticity has to be provided to the customers. Only in this way they will recognize the added value of this productions and increase their willingness to pay for them.

The question now is how to provide customers with a reliable, tamper-proof source of information. Apart from the expensive support that can be provided by third party certification bodies, many corporates have recently found their answer in a blockchain platform. Blockchain is a digital shared system that crypts information and store them in a way that every change apported to them can be traceable. Thanks to this technology it is possible to record events in a secure way, guaranteeing their transparency and incontestability.

The adoption of blockchain-based solutions is helping companies to speed up processing times and to solve longstanding problems such as the lack of details on the stationing of goods and the still excessive use of paper documents, too bulky and subject to potential loss and deterioration. In addition, beside the advantages linked to logistics, there are the ones related to marketing and communication. Companies are now able to record the origins of raw materials and to communicate them with transparency together with their certifications. This contributes to enhance the trust of their customers and to attract new curious or previously skeptic ones.

But now we come to face another problem: the support to use in order to transmit this set of secure information. The most widely used solution is a QR code impressed on the label or on the packaging itself. Carrefour, for instance, in collaboration with IBM and EY, has started offering the consumer a QR code access to all the information on the origin and processing methods of fruits, milk, eggs, cheese and meat. (1) Coop is doing the same to certify his organic eggs, obtained from free-range hens. (2) A similar solution has been implemented by a company producing PDO Buffalo Mozzarella in Campania. Their packages have on the label a “Blockchain – Quality Certificate” featuring a QR code that, if scanned through a smartphone, redirects to an online landing page containing nutritional aspects and information from the production steps to the processing and packaging phases. (3)

Keeping in mind that the annual cost of global food fraud is estimated to exceed $35 billion (4), despite the reliability granted by the blockchain, the one provided by QR codes is strongly arguable. Looking at them from the perspective of a fraudster, QR codes constitute just a ridiculously low additional cost in terms of black ink to photocopy the labels. In fact, they are fully reproducible and the links to where they redirect are of public access and visible to everybody. In addition, there are numerous online services that help you to create your own code, starting from whichever web link you like. Therefore, a QR-based solution, due to its ease of replication, might even incentivize counterfeiting, turning out to be more dangerous than adopting no solution at all!

To combat this, it is necessary to prevent the physical tampering of goods themselves, not of their packaging. The key is to combine the security of the blockchain technology together with the safety of a seal that combines both a physical and digital protection. This kind of technology has been developed by Authena, a swiss startup that created an anti-counterfeiting solution based on blockchain and on an adhesive tag to be applied on the packaging. This, when tapped via NFC, provides detailed info on the product, its authenticity and the steps it went through along the supply chain. In addition, whenever the container has a rigid form like a bottle, a can or a tank, the tag has also an anti-refilling function, as it is able to detect the open/closed state of the product itself.

Alessandro Tacconelli