Supermarkets are allocating more shelf space to fresh
food, prepared hot meals and local products, exacerbating “a drumbeat of bad
news” for packaged-goods companies, reported the Journal.
A Nielsen consumer analyst characterized
the plight of packaged goods as “death by a thousand cuts.”
This realignment is forcing many established brands to
rethink their market strategies. For example, Unilever
announced recently that it is looking to exit the margarine business as
part of an overhaul of its food and beverage operations.
The rise of fresh food offerings reflects a general shift
toward healthier consumables containing less sugar and fat, and buyers’ concern
over ethical issues and environmental sustainability. As a result, shoppers
want to know how and where their food purchases are sourced and created, and
what’s in them. This is particularly important for specific categories, such as
organic and gluten-free, which are experiencing substantial growth.
Blockchains have a key role to play in supporting the focus on these markets.
The technology — with its shared ledger and immutable data architecture and its
ability to run smart contracts — is being developed and tested in three
critical areas of the food supply chain:
- Sustainable agriculture: The
agricultural industry is harnessing the explosive growth in Internet of
Things technology by using arrays of sensors to monitor the usage of
materials such as pesticides and fertilizers. Blockchains’ interface with
sensor networks to provide farmers with the timely, secure information
they need to manage growing operations both profitably and sustainably.
- Supply chain transparency: In
addition to information on the raw materials that go into natural food
products, blockchains’ immutable record of every transaction in the
farm-to-fork supply chain is paramount. Relevant details are made
available to discerning consumers via smart labels paired with apps
running on mobile devices.
- Safety monitoring: Every year,
spoiled foods cause thousands of people in the U.S. to be hospitalized (and
some even die). A blockchain’s ledger can be used by retailers to pinpoint
the cause of these problems quickly, and to recall tainted natural food
products in order to limit consumer impact and maintain overall supply
will increase in importance as the market for fresh foods continues to evolve.
The Amazon/Whole Foods tie up is indicative of market dynamics and pressures,
with the likes of Walmart (which is testing IBM blockchain technology) stepping
up its fresh food offerings and specialist home delivery services gaining
attention, customers and venture investment.