As the public places increasing value on transparent information on the production, manufacturing and transportation of products, businesses need to attach importance to achieving supply chain transparency. Coupled with the COVID-19 pandemic, transparent supply chains are seen as a key element in businesses’ risk response.
Cheung Wai-man: COVID-19 Pandemic Accelerates Transparency of Supply Chains
Asuccession of work stoppages and shipping interruptions have occurred since the outbreak of COVID-19 last year, causing supply chain disruptions and dealing a heavy blow to the global economy. Meanwhile, the pandemic has led to increased demand for medical supplies, with some countries having to restrict the export of medical supplies to ensure sufficient supply domestically. There have also been rumours of insufficient food supply in Hong Kong, triggering a wave of panic buying. Cheung Wai-man, Director of the Asian Institute of Supply Chains & Logistics of the Chinese University of Hong Kong, said that supply chain transparency can help reduce public panic, “Public confidence can only be enhanced if supply chains become more transparent and people know about the stock and transportation status of the goods.”
Vaccine transportation attracts attention
The pandemic will likely ease with various countries in active development of COVID-19 vaccines, but some vaccines need to be stored at specific temperatures to ensure their quality. Cheung said that to give the public confidence in the quality of vaccines, there should be more transparency in production, manufacturing and transportation. How the processes are controlled and how the storage conditions are recorded during transportation are all factors that increase the transparency of the supply chain.
COVID-19 has changed our way of life and society has entered an era of new normal. People want to have more knowledge about the items they have purchased, such as the entire production process, the source of origin, etc. Supply chain transparency addresses their concerns in this regard, while enabling manufacturers to make better estimates for orders and sales.
To be successful in making information transparent, a platform for information access must be set up. Cheung said that it is easier to achieve supply chain transparency for high-end products. He believes that both buyers and sellers are more willing to disclose information because they are worried about mishaps occurring. However, for normal items, there is some difficulty in making supply chains transparent because of intense competition, “First of all, suppliers and logistics providers are willing to share information, but many people are unwilling to share as they think that such information is trade secret.” He stressed that even if information is available, it has to be processed and analyzed in order to be useful data.
Industry-level platform for information exchange
Cheung admitted that it is difficult for SMEs to employ people to analyze and process information because of the high cost. He suggested to set up an industry-level platform for information exchange so that industry players can share information with one another, providing a basis for achieving supply chain transparency.
In her latest Policy Address, the Chief Executive mentioned that Hong Kong businesses that have set up factories in the Mainland to produce goods for exports are facing difficulties due to the sluggish European and American markets. Therefore, the Hong Kong Trade Development Council will launch “GoGBA”, a one-stop platform, in collaboration with Guangdong Province and relevant chambers of commerce to provide all-round support for Hong Kong businesses, covering the Guangdong-Hong Kong-Macao Greater Bay Area market and policy information, advisory services and training, as well as business promotion, expansion and matching services. At the same time, it will also provide business support for Hong Kong businesses to assist them in handling import customs clearance, logistics and distribution, settlement of receipts and other operational matters. Cheung hopes that this platform can help Hong Kong businesses exchange information and accelerate the process of supply chain transparency.
Anna Lin: Faster Promotion of Digital Transformation for Effective Supply Source Traceability
As GS1’s local chapter, GS1 HK has established the use of GS1 standards as common practice for barcodes in Hong Kong since 1989. Today, many businesses across Hong Kong are already using GS1 barcodes. GS1 HK has also established an ecosystem that helps strengthen the traceability of production and supply sources to avoid counterfeit products.
Providing guarantee of authenticity
Anna Lin, Chief Executive of GS1 HK, said that amid the COVID-19 pandemic, personal protective equipment (PPE) have to meet particularly strict requirements. Currently, over 110 PPE companies in Hong Kong have adopted GS1 barcodes to boost consumer confidence. “A barcode with the prefix 489, together with other scientific accreditations, serves as a hallmark of quality for Hong Kong’s PPE companies, providing a guarantee of authenticity.”
Lin added that when the scanner app encounters a counterfeit barcode, it will send an alert, with such information as the time and location of the scan, to the brand owner to help it know and respond in a timely manner.
Improving food safety management standards
As COVID-19 poses a challenge for the food industry, Lin said that GS1 HK has launched a new “Quality Food Scheme+” this year. Through assessment of food & beverage businesses based on comprehensive internationally accredited standards, coupled with timely recommendations on epidemic prevention and control, it aims to encourage such businesses to adopt more stringent food safety management, control and traceability measures to boost consumer confidence.
“Beyond source traceability and responsible response to incidents, the new scheme, which is an upgraded version of the ‘Quality Food Scheme’, can strengthen food safety management and inspection standards to ensure regulatory compliance and increase customer confidence.” She added.
Lin noted that many SMEs have difficulty in implementing a comprehensive O2O strategy due to limited resources, thus hindering digital transformation. To this end, GS1 HK has set up a digital service team to improve efficiency by installing sensors on machines and production lines, providing various support for SMEs that are determined to implement digital transformation.
Improving supply chain tracking performance
According to Lin, in light of more and more IoTpowered supply chains taking shape, GS1 HK has launched a cloud-based data management platform – ezTRACK. Through connection with a variety of different IoT equipment, in tandem with AI and data analytics, it helps businesses formulate real-time actionable solutions to improve their overall analytic capabilities and accuracy of predictions, as well as enable them to take proactive actions. “For example, the food and beverage industry may install active sensors to track temperature, humidity and smoke throughout supply chains on a continuous basis, which can better allocate human resources, while reducing tracking time and improving accuracy.”
Looking to the future, Lin stressed that GS1 HK will continue to establish a smart business ecosystem, and thanks to its consistent standards, digital and enterprise data services, GS1 HK helps better bridge the physical and digital worlds, boosting the transparency, safety and efficiency of supply chains across a wide range of businesses. Over the long term, it can foster a better collaborative ecosystem via digital supply chains, thereby enhancing Hong Kong’s status as an international trading hub.
