By: Hilary Thesmar, PhD, RD, CFS, Chief Food and Product Safety Officer; and Adam Friedlander, Specialist, Food Safety and Technical Services, Food Marketing Institute
Since the beginning of civilization, humans have relied upon technological advancements to solve problems and improve standards of living. After the world wide web was made publicly available on August 6, 1991, conducting business became simpler by reducing transaction fees, accessing larger amounts of information and reaching a more diverse audience. Although the internet has impacted our lives in countless ways, security breaches continue to plague the internet’s reputation. On October 31, 2008, a new technology called blockchain – also called a distributed ledger – was introduced to resolve weaknesses in the Internet’s centralized infrastructure.
Built on the foundation of trust and security, blockchain is a technology framework that stores, updates and verifies data across a decentralized peer-to-peer platform. This data is stored in encrypted, timestamped records – or blocks – that link to previously approved blocks, thus guaranteeing legitimacy and creating a continuous chain of information accessible by all users. Distributed ledgers are adaptable and variable depending on the needs of the businesses sharing and accessing data.
Traditionally, food retailers have stored information on paper Purchase Orders (PO), Bills of Lading (BOL) or centralized digital databases, but these systems have become inefficient and cumbersome in today’s business world. One way blockchain is being used in the food industry is for food traceability. Connecting the supply chain for a single item creates tremendous challenges due to overlays between order, pricing, inventory, date and locality information, but all of this data can be stored in the blockchain, making it easily accessible. Finding the lot of a recalled product can be reduced from days or hours to minutes or seconds with blockchain.
According to the World Economic Forum, 10 percent of the Global GDP will be stored in blockchain technologies by 2027, and one of the driving forces behind industry-wide blockchain adoption is the Hyperledger Project, hosted by the Linux Foundation – a nonprofit organization that facilitates blockchain, cloud and Internet-of-Things (IoT) infrastructures. Since the project’s founding in May 2016, over 180 members have joined the Hyperledger Project to contribute open-sourced frameworks, code bases and educational opportunities that support transparent business transactions. Blockchain goes well beyond food retail because the technology can be applied to any industry, including banking, manufacturing, financial markets, healthcare, insurance, government and all industries with supply chains.Blockchain technologies are improving upon weaknesses created by the first generation of the Internet. Although these technologies and databases are in the early stages of development and self-regulation, adoption is rapid and companies are carefully, but quickly, evaluating their needs. FMI will continue to serve as the voice of food retail by assisting members with education, discovery, best practices and resources to ensure successful implementation within the food retail industry.