Supply Chain

Streamlining Certification Will Help Scale a Sustainable Food System

The often-arduous process for meeting sustainable certification requirements can be daunting, if not prohibitive, for smallholder farmers. Digitizing the process removes pain points for both farmers and the companies that source their crops.

Brand Provided | By Ofir Ardon | Published 8 months ago | About a 5 minute read

Image: Quang Nguyen Vinh

Over 65 percent of consumers want to make the right spending choices to live a healthier and more sustainable life, and they’re growing increasingly conscious of the environmental and social impact of their food choices. This shift towards prioritizing sustainability mirrors the food and beverage industry’s own recent initiatives, as leading brands continue to set goals to reduce their carbon footprint and implement social-impact programs.

However, amid rising greenwashing concerns, consumers and regulators are asking brands to provide proof of their sustainability claims; and food and beverage companies now find themselves navigating a labyrinth of certification requirements.

Common certifications include “Organic,” which assures that the product is produced without synthetic pesticides or fertilizers; and “Fair Trade” — indicating fair wages and ethical treatment of workers. Additionally, consumers often look for labels related to environmental impact — such as Rainforest Alliance or Carbon Neutral. These certifications not only provide transparency but also empower consumers to make choices aligned with their values and contribute to a more sustainable food system.

The path to achieving these certifications begins at the farm level, requiring food and beverage enterprises to take a closer look at their growers' agricultural processes and encourage them to adopt new procedures and technologies.

How the food supply chain challenges sustainability goals

On a daily basis, food and beverage companies must manage an intricate supply chain of thousands of growers spanning different regions, ensure profitability, and meet sustainability goals — all while addressing escalating demand for quality and safety. Their success on each of these initiatives is contingent upon gaining unprecedented visibility into the growing practices of their suppliers.

Popular food and beverage supply-chain technologies, such as enterprise resource planning (ERP) and product life management (PLM) solutions, predominantly focus on the logistics and production stages; however, the often-overlooked foundation of this complex system is the cultivation of agricultural raw materials, or crops. This blind spot has far-reaching consequences, particularly for the backbone of our food ecosystem — smallholder farmers, or those running farms under 5 acres.

Smallholder farmers produce 30-34 percent of all food supply on 24 percent of the world’s agricultural land — and even more disproportionately for key consumer commodities such as coffee and cocoa. Their operations are on a smaller scale, scattered across diverse and remote locations; and larger agricultural enterprises and commercial farming often overshadow their contribution.

The usual challenges faced by farmers — from unpredictable weather events and resource constraints to improper infrastructure and market uncertainties — are significantly amplified in the smallholder context, and they directly impact the complex web of global food and beverage supply chains. The current dynamics between these farmers and food and beverage enterprises presents challenges in achieving sustainability targets — including securing certifications to build market credibility. Smallholder growers, despite their crucial role in the supply chain, are often wary of making operational changes to meet sustainability certifications — due to concerns related to the potential economic impact of altering established farming practices, the initial costs associated with transitioning to more sustainable methods, and uncertainties regarding market acceptance and premium pricing for certified products. Additionally, farmers may fear disruptions to their traditional farming routines and worry about the feasibility of long-term compliance with certification requirements.

As a result, food and beverage companies encounter challenges in ensuring that their diverse network of smallholder farmers adheres to stringent sustainability standards. The process of certification also often involves considerable paperwork, rigorous audits and investments in training and infrastructure — creating barriers for both parties. This is problematic when dealing with a geographically dispersed supply chain involving a variety of local practices, languages and environmental conditions. These complexities multiply when food and beverage companies have to deal with several certification programs.

Streamlining sustainability goals & certifications with technology

Complying with various sustainability certifications imposed by third-party entities can seem daunting. Traditionally, farmers and field agents had to engage in lengthy surveys about their agricultural and chemical inputs, wages for farmers, and more — often repeating similar information for different certifications. The process, taking months in some instances, proved to be not only time-consuming but also prone to errors and inconsistencies due to manual input.

The good news is that handling and updating spreadsheets, communicating via email or — worse yet — handwritten records, and dealing with the complexities of manual data entry have become relics of the past. While a few companies still rely on these methods, many are transitioning to automated mobile survey tools and analytics — which drastically shortens the timeline and reduces manual work, allowing farmers and field agents to complete comprehensive surveys about their sustainability practices just once while covering multiple certifications.

For example, a leading food and beverage brand recently reported a reduction in the certification process from over two months to just a few days by implementing a digitized software solution to support both the brand and the farmers. The brand accelerated the process of tracking sustainable farming practices and paying the increased premium price to compliant farmers, both of which were backed by documented evidence; and the farmers received timely and proper compensation for their efforts. This not only speaks volumes about the efficiency gains but also the real-time benefits that companies can reap from implementing emerging technology in the certification process.

A win-win for food and beverage companies and growers

Beyond compliance, the shift towards emerging technology translates into other tangible benefits for smallholder farmers. By automating the certification process, farmers can focus on what they do best — cultivating quality produce — and reap rewards for their efforts, building greater trust between farmers and buyers.

Meanwhile, for food and beverage companies, this technological shift provides a streamlined approach to meet sustainability goals and achieve better visibility and accuracy for key certifications. The ability to obtain multiple certifications efficiently not only reduces costs but also aligns with the growing demand for responsibly sourced food products. It's a win-win situation, where companies can assure consumers of the quality and ethical sourcing of their products while fortifying the backbone of their supply chain —smallholder farmers.

Ofir Ardon

CEO at Agritask

Ofir Ardon is CEO of Agritask — a crop supply intelligence company, providing visibility into predictability and sustainability of crop supply for food and beverage enterprises.

Tags:

Agriculture