The Importance of Product Traceability in the Supply Chain
Product traceability is now a vital part of how responsible supply chains operate. With rising consumer expectations, stricter regulatory demands, and growing risks of counterfeiting or contamination, businesses must be able to precisely trace the journey of their products.
Whether it’s verifying ethical sourcing, ensuring food safety, or managing recalls efficiently, traceability enables companies to build trust, maintain quality, and protect their brand reputation. It helps meet global regulations like EUDR (EU Deforestation Regulation) and FSMA (Food Safety Modernization Act).
This blog explores the growing role of product origin tracking in the supply chain, its key elements, how it builds consumer trust across industries, and the way it can be done using new-generation QR codes.
Table of Contents
What is product traceability?
Product traceability means tracking a product from raw materials to final delivery, with precise data captured at each stage. It supports transparency, safety, and trust.
The end-to-end supply chain visibility empowers businesses to:
- Swiftly respond to recalls or quality issues.
- Meet global regulations like DSCSA (Drug Supply Chain Security Act), and FSMA
- Prevent counterfeiting and illicit distribution
- Foster transparency to build consumer trust
It helps reshape supply chains into smart, data-driven ecosystems, making product movement clear, secure, and accountable. Product origin tracking has become a foundation of modern supply chain operations, including manufacturing, logistics, and ethical sourcing.
Difference between product tracking and product traceability
At first glance, product tracking and product traceability sound like the same thing. They’re connected, but they serve different purposes.
Product tracking is mainly about movement. It records where a product is at any given point and follows its path forward through the supply chain. For example, knowing that a batch of coffee beans has left the port, reached the roasting facility, and is now en route to a distributor. Tracking answers the question: Where is the product now, and where is it going next?
Product traceability is broader. It covers movement and connects a product to its history and details, such as its source, the processes it went through, and the people or facilities involved along the way.
In short:
Tracking = recording location and movement at a given time or in real time when supported by advanced technology (GPS, RFID, or IoT).
Traceability as a whole = history, accountability, and trust.
How Product Traceability Works
Traceability systems usually operate in two directions, often described as upstream and downstream or backward and forward. The terms are closely related but differ in emphasis: upstream/downstream describe a company’s position in the supply chain, while forward/backward describe the flow of information across time.
Upstream (Backward Traceability): Tracing materials to suppliers
This direction focuses on where products come from. It traces the origin and movement of raw materials, components, and ingredients before production begins. Activities include identifying suppliers, logging batch numbers, and verifying certifications or quality checks.
In sectors like food and pharmaceuticals, upstream traceability supports sustainability claims, ensures compliance with safety standards, and allows faster responses to contamination events. The goal is clear accountability and product integrity.
Downstream (Forward Traceability): Following products to retailers and consumers
Once a product is manufactured, the flow shifts downstream. This direction follows items through warehouses, distributors, retailers, and ultimately to the end consumer. It combines product tracking (location and movement) with related data such as batch codes, logistics events, and sales activity.
Traceability Tools & Systems
The tools used for product traceability are:
Data Carriers
Data carriers are the technologies that hold and transmit product identifiers across the supply chain. The key element they carry is the GTIN (Global Trade Item Number), a standardized code from GS1 that uniquely identifies products worldwide. Different data carriers can store and share these identifiers or other product information.
Barcode: Barcodes are the most widely used data carriers and come in two main forms:
- 1D Barcodes (linear) – Examples include UPC (Universal Product Code) and EAN (European Article Number). They usually hold just the GTIN, making them ideal for retail point of sale (POS) scanning and basic tracking.
- 2D Barcodes (matrix) – Examples include QR Codes and Data Matrix. These can store not only the GTIN but also additional details such as batch/lot number, expiration date, or serial number. This makes them especially valuable in industries like food and pharmaceuticals where traceability requires more than just product identity.
RFID: Radio Frequency Identification (RFID) uses electromagnetic fields to automatically identify and track items with attached tags. Like barcodes, RFID can carry GTIN data, but it offers additional advantages:
- No line-of-sight required (tags can be read through packaging).
- Multiple tags can be scanned at once, making it faster for inventory counts and logistics.
- Suitable for real-time tracking in warehouses and distribution centers.
- RFID systems follow international standards such as ISO/IEC 17360:2023, ensuring industry interoperability and reliability.
IoT sensors
IoT (Internet of Things) provides continuous, real-time data on product conditions such as temperature, humidity, location, light exposure, and even vibration. This matters for industries like food, pharmaceuticals, and electronics, where a small change in environment can affect product integrity.
Practical examples include:
- Temperature loggers in cold-chain transport for vaccines or frozen food.
- GPS trackers on shipping containers to monitor location.
- Humidity sensors in electronics packaging to prevent damage from moisture.
- Shock/vibration sensors in medical device shipments to detect mishandling.
By integrating these devices into the supply chain, businesses gain visibility into transport conditions and can respond quickly to errors. This helps ensure compliance with safety standards, while reducing waste and product loss.
ERP/MES systems
Now that data is being captured from both IoT sensors and data carriers, the next step is consolidation and management.
ERP (Enterprise Resource Planning) systems consolidate information across procurement, inventory, and distribution. Advanced traceability platforms plug into ERP, supporting GS1 standards so data from across the chain flows into one structured system.
MES (Manufacturing Execution Systems) operate closer to the factory floor. They handle real-time production tracking, batch records, and quality control, ensuring every unit is tied back to the right materials and processes.
Working together, ERP and MES create end-to-end traceability. They link production batches, raw materials, and finished goods into a single data stream. This integration makes regulatory compliance easier, speeds up recalls, and enables performance analytics across the supply chain.
Key benefits of traceability
Let’s explore the key benefits of implementing product origin tracking:
Combat counterfeits
Traceability systems assign unique identifiers to each product or batch, allowing instant verification of authenticity. These codes track when and where a product is scanned, helping detect duplication, misuse, or counterfeit activity, especially in high-risk sectors like pharmaceuticals, electronics, and luxury goods.
Supports regulatory compliance
Product life cycle tracking supports compliance with ISO standards and global regulations like FSMA, EUDR, and DSCSA. It fosters accountability across teams and strengthens quality control from origin to shelf.
Enhances operational efficiency
Product lifecycle tracking reveals bottlenecks, improves machine utilization, and reduces manual errors through automated data entry. It helps brands optimize inventory, reduce waste, and accelerate recalls, boosting productivity and responsiveness across the supply chain.
Builds consumer trust
Product traceability empowers consumers to make informed decisions by giving them access to reliable product information. Through packaging labels, online platforms, or scannable codes, they can check sourcing details, sustainability claims, production dates, and certifications.
This level of visibility reduces misinformation and strengthens accountability. When people know a product’s origin and how it was handled, they are more confident in their purchase. That confidence builds trust, which eventually translates into stronger loyalty and repeat business.
The Better Way: GS1 Digital Link QR Codes
For years, 1D barcodes and QR codes had separate functions. The 1D barcode was designed for point-of-sale and logistics. The QR code was mostly a marketing tool for consumers.
Now, with GS1 Digital Link QR codes, those roles come together. A single code on packaging can do far more than marketing or checkout. It contributes directly to product traceability.
These QR codes can hold far more information than 1D symbols. In one scan, they can carry:
- Lot numbers, expiration dates, and batch data
- Product identifiers and usage instructions
- Traceability links and safety guidelines
Beyond static data, they can connect to real-time online information. That means dynamic updates, seamless integration across supply chain systems, and visibility across the entire product lifecycle.
Crucially, GS1 Digital Link aligns with global regulations such as the EU Digital Product Passport, FSMA 204 for food traceability, and DSCSA for pharmaceutical serialization. Merging product identification, compliance, and consumer transparency bridges what used to require multiple codes into one unified standard.
Use cases
These codes are revolutionizing traceability across key sectors:
- Food Safety: GS1 QR code enables farm-to-table transparency by linking to sourcing, processing, and safety data. They allow consumers to verify ingredients, allergens, and freshness in real time.
- Luxury goods: QR codes enable instant access to a luxury product’s origin, materials, and authenticity through a single scan.
GS1 Sunrise 2027 is encouraging retailers around the world to upgrade their checkout systems by 2027 so they can read 2D barcodes like QR codes. This upgrade is designed to improve supply chain transparency.
However, the switch isn’t mandatory yet. Traditional 1D barcodes will still work, and businesses can continue using them until 2D barcodes become a required standard.
To stay ahead during this transition, it’s a good idea to print both 1D and 2D barcodes on your packaging. This ensures your products can be scanned by retailers, whether they’ve upgraded or not.
Companies have two options for creating GS1-compliant 2D barcodes:
- To follow GS1’s setup guides and build their own software.
- To use a reliable third-party tool like QR Tiger’s GS1 QR code generator to encode product data correctly.
Supply Chains with Smarter Traceability
Product traceability is no longer an option but a strategic necessity in supply chain systems. From tracking raw materials upstream to verifying authenticity downstream, traceability systems empower businesses to meet global regulations, enhance safety, and build consumer trust.
With advanced tools like QR codes powered by GS1, companies can unify product data, enable real-time updates, and align with standards like FSMA 204 and the EU Digital Product Passport. Embracing product lifecycle tracking in the supply chain helps businesses future-proof their operations and strengthen brand integrity.
FAQs
How do GS1 QR codes improve product origin tracking compared to regular QR codes?
Unlike regular QR codes that typically link to a single static webpage, GS1 QR codes contain structured, product data in the URL. At checkout, this data is scanned for product identification, and when scanned by smartphones, the same code links to detailed product information.
This dual functionality supports real-time traceability, helps meet global compliance standards like FSMA and the EU Digital Product Passport, and allows brands to share verified sourcing and safety details with consumers in a single scan.
What are the regulatory requirements for product sustainability?
Regulatory requirements for product sustainability vary globally but increasingly demand accountability, supply chain transparency, and measurable impact. In the EU, the Ecodesign for Sustainable
Products Regulation (ESPR) defines strict criteria for product durability, recyclability, and circularity across nearly all physical goods, aiming to decrease environmental footprint and support the Circular Economy Action Plan (European Commission).
In the U.S., the SEC (Securities and Exchange Commission) has proposed climate-related disclosure rules that include emissions reporting and governance around climate risks. These evolving regulations indicate a global shift toward standardized sustainability reporting and product lifecycle management.
What’s the difference between internal and external traceability?
Internal traceability means tracking products within a single organization, such as inside a manufacturing plant or warehouse. It helps companies monitor production steps, manage inventory efficiently, and ensure consistent product quality.
On the other hand, external traceability involves tracking products as they move between different stakeholders in the supply chain, like suppliers, transporters, and retailers. This ensures products are correctly identified and safely delivered to their final destination.
Both types are essential for full traceability, allowing companies to trace a product from origin to end-user and back if needed.
DISCLAIMER: We acknowledge that GS1, as well as the materials, proprietary items, and all related patents, copyright, trademark, and other intellectual property (collectively, “intellectual property”) relating to its use, are the property of GS1 Global, and that our use of the same shall be in accordance with the conditions provided by GS1 Global.
