What is supply chain traceability?

Why is supply chain traceability important?

Modern supply chains are more global, more fragmented, and more vulnerable to disruption than ever before. In this complex environment, supply chain traceability has become a business imperative. It isn't just a competitive advantage, but a requirement for resilience, compliance, and customer trust.

Here’s why supply chain traceability matters:

• Regulatory compliance: Meet evolving requirements like the EU Digital Product Passport, the U.S. FDA’s FSMA 204 rules, and the EU Deforestation Regulation (EUDR).
• Risk management in supply chain: Quickly identify and respond to issues such as product recalls, quality failures, or safety incidents.
• Brand protection: Combat counterfeiting, unauthorized resale, and product diversion with end-to-end visibility.
• Operational resilience: Detect and resolve inefficiencies, delays, and disruptions across your supply chain.
• Consumer trust: Demonstrate transparency by showing where products come from, how they’re made, and how your operations impact people and the planet.

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What is the process for tracing a supply chain?

To trace a product effectively, you must collect, record, and share data at every stage of its life cycle, from raw material sourcing and manufacturing to distribution, use, and eventual disposal or reuse. This end-to-end visibility is what enables true supply chain traceability. Usually, the process includes:

• Unique identification: Digital identifiers like QR codes, barcodes, or RFID tags are placed on products. These act like digital passports.
• Data capture: Every event in the supply chain, such as production, inspection, shipping, and receiving, is logged with that identifier.
• Data integration: These records are put into a secure digital system that brings together information from suppliers, carriers, manufacturers, and retailers.
• Real-time monitoring: Dashboards show where products are, how they are being handled, and if there are any problems, such as temperature spikes or changes in route.
• Audit and insights: You can examine and audit historical data for compliance, sustainability reporting, or ongoing improvement.

OpenText™ Core Product Traceability Service makes this possible on a large scale in global, multi-tier supply chains.

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What are the benefits of supply chain traceability?

Businesses that leverage supply chain traceability have a strategic edge. Here are some of the key benefits:

• Faster issue resolution: Quickly isolate affected batches during recalls or quality issues, avoiding full-scale disruptions.
• Regulatory readiness: Maintain auditable records and generate reports on demand to meet compliance requirements.
• Counterfeit prevention: Use digital identifiers and secure product markers to verify authenticity and prevent fraud.
• Improved supplier collaboration: Share trusted data across partners to enhance planning, fulfillment, and product quality.
• Stronger brand equity: Leverage traceability to demonstrate ethical sourcing, carbon footprint tracking, and responsible business practices.

Traceability is the key to strong, open, and customer-focused supply chains in a world where data is king. With OpenText Core Product Traceability Service, a platform that improves supply chain visibility, safeguards brands against illicit activities, and encourages direct consumer engagement through digital product tracking, companies can establish trust at the source using simple, scannable QR codes.

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What are the challenges in achieving end-to-end supply chain traceability?

Achieving true end-to-end traceability is complex since global supply chains involve many tiers of partners—each using different systems, data formats, and levels of digital maturity. Disconnected technologies, manual processes, and reluctance to share information create gaps that make it difficult to track a product’s full journey, from raw materials to finished goods. Without consistent, real-time data across all stakeholders, building a complete and trustworthy traceability system is a significant challenge.

Here are some of the most common challenges that businesses face:

• Isolated data systems prevent businesses from forming a complete view of the supply chain, as critical information is often scattered across multiple platforms, locations, and trading partners.
• Inconsistent data standards across stakeholders—including variations in formats, terminology, and technology—make it difficult to integrate and exchange information seamlessly.
• Limited digitization among suppliers slows down traceability efforts, as many still rely on manual or paper-based processes that hinder real-time data collection and visibility.
• High implementation costs for traceability technologies, such as sensors, serialization, and data platforms, can be a barrier for smaller suppliers and budget-conscious organizations.
• Reluctance to share data across the supply chain creates transparency gaps, as some partners are unwilling to disclose operational details due to trust, privacy, or competitive concerns.

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Which industries benefit most from supply chain traceability?

While supply chain traceability adds value across all sectors, it’s especially critical for industries that are:

• Highly regulated
• Complex and global
• Risk-sensitive
• Brand-driven

Examples of such industries include:

• Pharmaceuticals: Meet DSCSA and ensure patient safety through serial number tracking.
• Food & beverage: Comply with FSMA 204 and recall tainted batches without impacting entire product lines.
• Automotive: Track parts across multi-tiered suppliers to manage recalls and quality assurance.
• Luxury goods: Authenticate high-value products and prevent grey market sales.
• Consumer electronics: Verify sourcing, detect component-level failures, and support repair or recycle flows.

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What role does technology play in enabling supply chain traceability?

Technology is the foundation of modern traceability. It enables organizations to capture, share, and act on data throughout the entire supply chain.

Key technologies include:

• Digital identifiers such as QR codes, RFID tags, NFC chips, and blockchain tokens, which give each product or component a unique, trackable identity.
• IoT sensors that monitor real-time conditions like temperature, humidity, shock, and location, providing continuous visibility into product handling and storage.
• Cloud-based integration platforms that connect internal systems (such as ERP, MES, and WMS) with external partners, creating a unified data flow across the value chain.
• AI and advanced analytics that detect anomalies, predict disruptions, and optimize inventory, logistics, and sourcing decisions.
• Mobile applications that allow field teams to scan items, verify authenticity, and log activities from any location.

OpenText Core Product Traceability Service brings these technologies together into a single, scalable platform—turning traceability from a compliance requirement into a strategic advantage.

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How are supply chain traceability, trackability, and transparency different?

Although often used interchangeably, traceability, trackability, and transparency refer to different but related concepts within supply chain visibility.

• Traceability is the ability to record and reconstruct the full history of a product or component—tracking where it came from, how it was handled, and what changes it underwent. It includes both upstream (backward) and downstream (forward) tracking using data collected at every stage of the supply chain.
• Trackability typically refers to the real-time monitoring of a product’s current status or location as it moves through the supply chain. It focuses on the "where" and "when" of product movement, often using technologies like GPS or IoT sensors.
• Transparency is the act of sharing traceability or trackability data openly with stakeholders—such as customers, partners, regulators, or the public. It reflects a company’s willingness to disclose meaningful insights, such as ethical sourcing or carbon footprint, to build trust and meet compliance requirements.

For example, a business might use internal systems to trace and track every step of its supply chain but only share selected sustainability or safety data with consumers.

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How does OpenText help with supply chain traceability?

OpenText helps enterprises gain full visibility and control across complex global supply chains with OpenText Core Product Traceability Service and the OpenText™ Business Network.

With OpenText Core Product Traceability Service, businesses can assign secure digital product identities, like serialized QR codes, to items, then capture and visualize every traceability event from production to post-sale. Real-time dashboards and audit trails enable instant recall readiness, regulatory compliance, and a clear view of a product’s origin, movement, and handling conditions.

OpenText Core Product Traceability Service also supports brand protection, helping detect diversion and counterfeiting, and aligns with major regulations like the EU Digital Product Passport (DPP), FDA FSMA 204, and EUDR. Seamless integration with IoT, ERP, and content systems ensures traceability becomes a core layer of your enterprise operations, rather than a siloed tool.

Unlock the power of connected, compliant, and transparent supply chains. See OpenText Core Product Traceability Service in action!