Smart Labels

Trend Definition 

What is the essence of this trend? What is its impact? 

• Essence: Smart Labels represent a technological leap in labelling, integrating RFID, NFC, TTIs, and QR codes to provide digital tracking, monitoring, and data collection for products and assets
• Impact: Smart Labels improve supply chains by offering solutions for enhanced visibility, security, and quality control (like monitoring food freshness) as well as a reduced reliance on physical labels, decreased costs, and a positive environmental impact

Trend Drivers 

Why is this trend emerging now? What’s changing? 

• Need for Enhanced Traceability: The increasing complexity of global supply chains, fostered by global trade and diversified supplier networks, requires better possibilities to track the supply. Increasing traceability fosters a timely delivery, reduced risks, and a higher level of transparency in the procurement process
• Digital Transformation in Supply Chains: In an environment characterised by complexity and disruptions, digital technologies help reduce uncertainty for the buyer regarding quality, availability, and delivery of the products as well as decision-making

Use Cases 

How to apply this trend? 

• Smart Containers: Reducing product failures through shipment tracking
  Example: Maersk employs smart containers to provide real-time insights into the temperature, humidity, and location of sensitive cargo like pharmaceuticals and perishables to prevent spoilage, reduce insurance claims, and enhance customer trust
• RFID Inventory Tracking: Track items to optimise procurement processes
  Example: Walmart uses RFID technology to allow automated inventory management, significant improvements in inventory accuracy, a reduction of out-of-stock instances, and streamlining replenishment processes

Procurement Relevance & Response Strategies 

How should Procurement adapt its Processes, Organisation, and Strategy?

• Refined Quality Control Processes: Verify product authenticity by incorporating smart label data to prevent counterfeit products from entering the supply chain
• Integration of Smart Label Data: Procurement systems should be tailored to utilise data from smart labels for targeted inventory management such as quick procurement responses to automate stock-level updates