Mike Ferguson, Senior Vice President of Fresh at Topco Associates LLC
iTrade Solution: Traceability enablement program for the suppliers of Topco members
Q: Topco and iTrade have been partners for many years. Can you briefly describe the history and nature of your relationship with iTrade?
Topco has traded on the iTN platform and found the service to work well for our business for a long time. We embarked on a more strategic relationship in 2020, when faced with the bio-engineered foods disclosure standard record keeping requirements. By conducting all of our produce sourcing activity within the iTrade platform, we had an opportunity to use this as a point to capture the BE status of items we source and share that with our members in order to be in compliance to these new recordkeeping requirements and to have the ability to quickly respond to audits or inquiries. From there we began the journey to explore iTrace as a potential solution for the proposed FSMA 204 regulations. Learning from our experience with the NBFDS requirements, we wanted to ensure we get ahead of the pending changes and come into compliance first. Ultimately, the benefits of being able to offer our members peace of mind related to compliance was critical but additionally having the opportunity to fully leverage the information captured in PTI to improve freshness and the product quality in our member distribution centers and stores is a very compelling advantage.
Q: Traceability requirements can take some time to take effect. Unfortunately, this means that there is a lack of urgency in the industry when it comes to preparing for these changes. Why was it important for Topco to set up a comprehensive traceability program sooner rather than later, far in advance of the 2024 FSMA 204 mandate? What would the consequences have been if you had not acted now?
I would answer this in two ways. First, we always seek to be proactive in how we approach working with our suppliers on behalf of our members. We felt confident in the iTrace solution being able to meet the final draft of FSMA 204 and that the iTN team would be there to support on-boarding suppliers best if we worked further ahead of the implementation date. Additionally, starting now ensured we would be on the leading edge of providing the ability to improve our freshness and respond more accurately and faster for recalls and product withdrawals or consumer advisories regarding the produce we source for our member companies. This makes us better for our members and our members better for their shoppers.
Q: In the food supply chain, we are required to capture traceability data and comply with changing industry requirements. Many see this as a sunk cost, but it’s clear that Topco understands that traceability data can give you and your members value far beyond compliance. What are some of the main benefits you all have experienced with iTrade’s traceability program?
To date we have onboarded about 20 suppliers fully so some of our advantages are yet to be realized, but we are confident that in the future and as we expand to include more suppliers we will have several instances and examples of the positive impact. While it is very hard to add cost in our sourcing of product at any time and particularly hard to do so now, as we have seen incredible inflationary headwinds across our industry, the iTrace solutions are priced competitively.
Q: What considerations were made in the decision to choose a traceability program? What about iTradeNetwork gave you confidence that we would be a good long term partner as the industry continues to change and implement regulations?
First and foremost, the experience we had as we developed a customized solution for the bio-engineered foods disclosure standard. I’m still amazed at how some of the largest operators in our industry have simply not addressed this with the level of confidence we believe is important. But iTN helped us develop a customized solution that met our needs on cost and flexibility for our members businesses. When we started the conversation related to iTrace, the service commitment was evident from the beginning and iTN has been focused on helping us manage this and done the heavy lifting to on-board our suppliers with a dedicated team and dedicated resources. We are making good progress toward our goal of on-boarding the first phase of prioritized suppliers in phase 1. Additionally, the support for communication to our members and training our team, as well as working one on one with suppliers who need the support and assistance, has been exactly what we needed.
Q: Transparency is of critical importance for Topco. What does transparency mean to Topco and why is it so important to your members and consumers?
We look at micro and macro trends in the marketplace regularly, and it is clear shoppers want more transparency and they also want it without adding additional cost. Today it is expected and retailers that will win long term are finding ways to meet shoppers where they are and fulfill their expectations, if not exceed them. At this time, we have not launched a shopper facing or brand aligned message to share this with our member shoppers, but that will be one of the areas we continue to explore with iTrace in the future.