Intelligent Food Labeling by MCC Label

Intelligent Food Labeling

Dear Reader, Increasing consumer expectations coupled with regulatory requirements means that food manufacturers are under mounting pressure for supply chain traceability and transparency. Meanwhile, digital commerce’s transition has emboldened counterfeiters across all industries impacting revenue and a brand’s reputation. Digital technologies, such as automatic identification, help navigate the complexities of today’s market and transform the relationship between the brand and the consumer. Read on to discover how the next generation of food labels go way beyond the packaging. The MCC Food and Dairy Team

In this issue 4

Food Safety

Track and Trace

What is Digimarc?

Building a sustainable future

“Intelligent Food Labeling” is a publication of Multi-Color Corporation. Copyright © by MCC. All rights reserved. The content of this document, including all copy, images, and attachment(s) are property of MCC and should be treated as confidential. It cannot be shared with or forwarded to third parties and cannot be published without MCC’s prior permission. If you have any questions regarding the use of this document, please email marketing@mcclabel.com.

Food Safety Today’s consumer expects and deserves safe food. With a heightened focus on food safety and regulation comes a need for transparency and product information. Companies are increasingly required to help track and trace food throughout the value chain – from farm to fork.

Companies are looking for ways to minimize the financial impact of their next recall. The problem is also a health challenge as the CDC estimates foodborne diseases sicken 1 in 6 Americans annually, resulting in roughly 128,000 hospitalizations and 3,000 deaths.

Brand protection According to the International Chamber of Commerce, the value of counterfeit and pirated goods will exceed $1.9 trillion globally by 2022. The counterfeit and pirated goods trend has coincided with the supply chain becoming more complex and more commerce moving online. As a result, many brands employ a multi-pronged brand protection solution, with one of those schemes utilizing similar supply chain visibility techniques for track and trace to authenticate products and identify distribution stages where products are diverted to unauthorized distribution points.

As a result, consumer and retailer expectations, insurance mandates and regulatory requirements necessitate that consumer goods companies and food manufacturers communicate precisely when and where products were produced, distributed and sold across the product’s supply chain, an operational process known as track and trace.

Traceability partners MCC aspires to be at the forefront of tackling these issues and is delighted to announce its partnership with Digimarc. Digimarc works with leading consumer brands on traceability in the supply chain and is an expert in automatic identification technology.

According to the recent study “Trends in Food Recalls,” by the U.S. Department of Agriculture April 2018, recalls in the food industry are also costly to a brand costing roughly $29M per occurrence. These costs span both direct expenses related to addressing a recall event in-process and indirect costs downstream after the recall event.

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Over the years, MCC has shown continued leadership in the area of printing Digimarc at scale and with excellent quality. We are excited to work with MCC to serialize packaging and help our customers overcome their traceability challenges.” Jay Sperry, Platform Evangelist at Digimarc

Many consumer brands cite a lack of accurate, timely and complete supply chain data as the main challenge of mitigating recalls and identifying counterfeits. The Digimarc Platform supports traceability efforts by providing products with unique serialized identities—and when combined with an IoT management platform—companies can launch sophisticated track-and-trace operations. In addition, the

Digimarc Platform opens the door to new and improved recycling streams. It makes plastics easy to scan, which means automatic sorting is much more accurate. MCC’s rich expertise in the area of digital and hybrid printing brings Digimarc’s serialized, nearlyimperceptible identities to life and at scale.

What is Digimarc Barcode? Digimarc Barcode is a machine-readable digital identity that can contain the same data as UPC/EAN symbols or carry similar information to QR and DataMatrix codes. Digimarc is a seamless element of the packaging artwork itself, unobtrusively doing more than visible codes can. Digimarc provides a software and services platform for enhancing media with Digimarc Barcode, detecting Digimarc-enhanced media, and verifying the accuracy and efficacy of Digimarc Barcode. Further, Digimarc has pre-integrated its software platform into an ecosystem of 3rd party scanning devices and applications to provide customers with a complete traceability solution. How does it work? Digimarc starts with the same data found in a traditional barcode then repeats this data multiple times across the package or physical asset. Traditional UPC/EAN barcodes and two-dimensional alternatives such as DataMatrix and QR codes are highly visible. They require dedicated design space, generally limiting their use to just one instance per package. By comparison, the low contrast of Digimarc often makes it undetectable to consumers. This allows for repeating Digimarc many times across a package and also

enables variable, serialized identities to be included in graphics where there is limited space. Digimarc can also be applied to cases and pallets, where its unique reduancy improves the reliability and accuracy of scanning in challenging environments. When scanning, businesses can use handheld, machine vision, and mobile devices commonly found in their supply chains to retrieve the Digimarc Barcode data. Data carried in Digimarc Barcode is GS1 compliant, and thus, 3rd party devices and application vendors can more easily integrate it. Today, Datalogic, Honeywell, Zebra and Cognex are commonly found in supply chains, and each of them supports Digimarc scanning. Digimarc’s software can be incorporated into mobile applications and web scanning applications, enabling “bring your own device” workflows for mobile devices. EVRYTHNG, Rfxcel and Sperantus are examples of IoT management platforms that have integrated their mobile and web scanning features to read Digimarc. These IoT management platforms are responsible for storing and tracking each asset’s provenance information and reporting on it, making it accessible to brands. Additional device vendors and applications can be integrated on customer request.

Looks like this

The same information contained in the UPC code is replicated hundreds of times across a package but is difficult for humans to see.

Performs like this

This Illustration depicts the concept of replicated codes for greater performance, but there is minimal or no visible Impact for consumers.

Unique benefits of Digimarc Improve visibility of supply chain Provides more timely, accurate and complete capture data critical to business decisions such as recall management. Digimarc’s serialized identities on product packaging communicate information at the batch, lot and item level, to communicate exactly when and where products were produced and distributed. Streamline data capture operations across the supply chain Digimarc delivers higher scan rates and higher first pass read rates than conventional barcodes. Futher, Digimarc delivers data that is redundantly applied across the product packaging, dramatically increasing scanning speed and success rates. Studies show Digimarc can be scanned 34% faster than QR codes for time savings at every step in the supply chain.

Differentiate brand protection Digimarc can be imperceptible and therefore applied across the entire product package. It is applied at the point of printing and therefore is difficult for counterfeiters to remove or isolate. Unlike conventional barcodes, Digimarc is difficult to counterfeit. When coupled with an IoT Management platform, this counterfeit protection is taken to the next level. Assists in meeting sustainability goals When Digimarc is applied with industrial inkjet, studies show an ink reduction of up to ~70% compared to conventional codes. Likewise, Digimarc’s imperceptibility allows it to be placed on the front of packaging. And in scenarios where packages contain multiple labels, the front and back label matching can be automated, which in turn reduces manufacturing waste.

Track and Trace Track and trace across the global supply chain is increasingly essential for consumer brands and food manufacturers to promote consumer safety, mitigate risk and gain real-time insight into raw materials and product locations in farms, warehouses, logistics and distribution centers.

Food regulations Recent and in-process regulations in Canada, Mexico, U.S. and Europe are driving food manufacturers to seek track and trace solutions. Many of these regulations are changing labeling practices on consumer prepackaged fresh fruits, vegetables, meat and dairy items now requiring lot code or other unique identifiers to be applied to the package. Further, these regulations are requiring key events to be recorded during the product’s supply chain journey and provided in a digital means to downstream parties and recall investigators. These events cannot be effectively recorded via manual means and now require a digital and more automated means of data capture. Premium graphics MCC has been working with Digimarc to develop a hybrid printing method in which Digimarc Barcode can be printed in large volumes, in one product line. Traditionally, variable data such as batch codes have required an additional step in the printing process, whereby they are printed offline, over the top of the label. The problem with this is it can dull the image and make the overall labelless aesthetically pleasing. MCC uses an

underprint process to eliminate any visual imperfections that could be caused by the dot pattern. The result is a full color, high-quality label graphic with an imperceptible, unique Digimarc identify embedded within. Take, for example, a carton of berries. Once the berries are picked, each clamshell has a serialized, Digimarcenhanced label produced by MCC’s hybrid printing process. Included in MCC’s printing services are quality control steps to ensure the Digimarc is scannable later in the supply chain. From that point forward, the individual clamshell can be traced back to the farm on which they were picked, up to the point of sale. This video illustrates how Digimarc can help berry farmers capture this tracking information via highspeed manual scanning. It further shows how a berry picker, clamshells, trays and a pallet are associated with each other and the harvesting information inclusive of date/time and location. This scan translates into a digital harvesting event stored within the IoT Management application and later shared with the retailer, consumer and government recall investigator. This sharing of data can utilize technologies such as Blockchain or other methods.

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Building a Sustainable Future .75”

Plastic is durable, lightweight and economically efficient. It’s an integral part of modern society. However, the amount of plastic waste currently being generated is cause for concern. Moving to a circular economy will see plastic waste greatly reduced through effective recycling systems. But achieving this goal requires a shift in focus: plastics need to be designed to be recycled, right from the get-go. This is where HolyGrail 2.0 comes in.

It’s a global initiative that encourages manufacturers to switch to packaging with digital watermarks, enabling simpler and more efficient recycling. Digimarc is a part of the HolyGrail 2.0 project, and participant brands can activate their packaging using Digimarc identies. Orkla, a leading supplier of branded consumer goods in Europe and India, has stepped up to the plate and accepted the sustainability challenge and is now working with MCC and utilizing Digimarc identities Orkla’s sustainability goals “We have ambitious sustainability targets by 2025, including sustainable packaging,” explains Pavel Komurka, Packaging Innovation and Sustainability Coordinator at Orkla. “Now is the time for exploration, innovation and overhauling our methods of recycling. Not only do we need to reduce the amount of plastic used in packaging - without generating more food waste - we also need to ensure that plastic packaging is not just theoretically recyclable, but actually being recycled. Bringing in Digimarc barcodes is a huge step towards achieving this goal.” The packaging targets Orkla is aiming to hit in the next five years will see all packaging materials designed with sorting and recycling in mind. Plastic packaging will contain at least 50% recycled components, or components from renewable resources. And it will be designed to be easily identified by automatic sorting processes, ensuring as much material as possible is ultimately recycled.

Accepting the value of plastics Considering the challenges ahead, there is one burning question: why not just get rid of plastics altogether? When looking at plastics from a wastemanagement perspective, it’s easy to forget how much they have assisted the development of modern society - without plastic, modern life would look very different. Plastic packaging has extended the shelf life of many products, and enabled globalisation through the ability to transport foods over long distances. “Some communities and regions have come to view plastics as an enemy to fight, but there’s no rationality behind this. Plastics have greatly aided the human race and improved our living standards,” says Komurka. “Our way of life has become dependent on plastics, which is why it’s so important to manage this valuable resource efficiently.” Traffic-light recycling model To begin the transition to more sustainable packaging, Orkla created an overview of the types of plastics currently being recycled in Europe. They developed a traffic-light model: ‘green’ plastics are already collected and recycled in a traditional recycling system, and ‘red’ plastics are not recyclable. ‘Yellow’ plastics are theoretically recyclable but not actually being recycled. There are various reasons for this: lack of appropriate recycling streams, not having collection systems in place, difficulty sorting the plastics, or not having an existing market for the recycled components. In identifying ‘yellow’ plastics, Orkla revealed the products with the greatest potential for improved recyclability.

Green light for yellow plastics For their next step, they worked with the experts at MCC Verstraete IML to introduce Digimarc Barcode into the packaging of one of their most prominent products. The Interactive IML labels of MCC Verstraete IML - labels printed with Digimarc Barcode - open the door to new and improved recycling streams. It makes plastics easy to scan, which means automatic sorting is much more accurate. With Digimarc Barcode, ‘yellow’ plastics are more easily identified, sorted and ultimately, recycled. Thanks to improved recycling streams, more and more ‘yellow’ plastics will be given the green light and merged into the circular economy. Further interactive features The possible applications for Digimarc go far beyond just sorting. Scanning technology and augmented reality apps have the potential to provide information in an entertaining way. For Orkla, this is one of the most exciting aspects of this technology. “We are creating ways to actively engage with consumers,” explains Komurka. “With Digimarc, we can alter how people view waste. For example, when a bottle is empty, it becomes unwanted - something to be gotten rid of. Now imagine if, instead of just throwing this away, the consumer could scan the bottle with their smartphone and be shown new possibilities. We could present ideas and provide examples, from reuse options to new products created at the end of a recycling stream. We could make this fun; not only amaze them with the technology and information, but provide a story

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that they, themselves, are a part of. With Digimarc, we’re able to explore an exciting new world of opportunities.” Future recycling Orkla is committed to maximising recycling and managing plastic waste responsibly. However, the future is far from set when it comes to recycling being the only option. “Recycling is currently the best method available, but who’s to say this won’t change in the future?” muses Komurka. Current status For now, Orkla is focused on contributing to HolyGrail 2.0 with the implementation and further proliferation of Digimarc identities. The first step in this process is to test the waters by introducing interactive IML across a wide range of packaging materials. “We couldn’t be more pleased with the co-operation and service offered by MCC Verstraete IML. Not only does the new packaging improve recyclability, but it looks fantastic,” reflects Komurka. Following the market release of these products, Orkla will move towards the next phase in optimising recycling: overhauling the waste stream. Nobody may know what that future of plastic looks like just yet, but with Digimarc and a thirst for innovation, Orkla is paving the way to new possibilities.

The history of plastic is very short. Could recycling bring new and unforeseen threats? Perhaps the ultimate answer will be something we haven’t even considered yet. Unless we are willing to ask new questions. As times change and new technologies are developed, new options are sure to emerge.” Pavel Komurka, Packaging Innovation and Sustainability Coordinator at Orkla.

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Our intelligent labeling expert Matthew Thomas Contact: marketing@mcclabel.com