For a long time, no one was interested in a company’s supply chain. However, this has changed dramatically in recent years. Consumers want to know where exactly products come from. According to a survey by PwC, 87% of consumers inform themselves about the origin and manufacture of a product. One third of the people surveyed switch to another company or decide not to buy a product because of a lack of transparency.
Principles of supply chain transparency
Supply chain transparency means having a basic understanding of how the supply chain is structured and which parties are involved. This goes beyond contractors throughout the entire supply chain. Creating transparency in one’s own supply chain is a basic premise for implementing corporate due diligence. Only if companies know where, how and by whom their products are manufactured, they can effectively address social, environmental and corruption risks in their supply chain through concrete measures. Also with regard to the involvement of stakeholders, transparency must be created at the outset as to which stakeholders are involved in the supply chain.
Each of us knows the green promises that companies like to make. Transparency in the supply chain could, among other things, determine how ethical or environmentally conscious a company is. The problem is often that without transparent communication, consumers have no way of verifying the promises made by companies. Another problem is that the origin of the product is difficult to ascertain, especially when a product consists of many individual parts and sometimes products differ only slightly or not at all despite their different origins (e.g. a T-shirt). Digitalization has the advantage that consumers can theoretically access product origin information at any time through the “Internet of Things”. Theoretically, this is not only possible across product categories, but even for a specific individual product. At fairafric, for example, you can always track where the individual raw materials for our chocolate come from.
There are a few ways to illustrate the transparency of a company. From technological solutions to personal contact with suppliers. This is also our way! Personal contact and direct exchange with our suppliers is of greatest importance to us.
When it comes to technological solutions, some companies rely on blockchain technology. This database management system works like a decentralized cash book. Each entry is compared with the previous entries by means of an algorithm. Blockchain technology enables open and data-based communication for all participants.
Influence of consumer choices on supply chain transparency.
In recent years, there has been a change in consumer behavior. Consumers increasingly want to buy products that have been produced according to sustainable standards. This includes ecological factors such as the environmental performance of production facilities, but also social factors such as working conditions and economic factors such as fair wages for workers. As soon as the products no longer originate from the region, it becomes increasingly difficult to transparently disclose the supply chain. The reason for this is not least the global network of supply chains, which are difficult to monitor if they have not been set up transparently from the start.
The fairafirc supplier network
It is very important for us to share our suppliers with you in a transparent way. Therefore, on our new website, we introduce you to our partners along the entire value chain and show exactly where we source our raw materials. We pursue a position of 100% transparency beyond cocoa: We work exclusively with fair and certified organic raw materials.
The salt for our Fleur de Sel milk chocolate, for example, is the world’s only Fairtrade salt and is extracted in South Africa from an underground seawater lake. It contains more than 84 minerals and is completely free of microplastics!
Unfortunately, there is currently no possibility for us to buy milk powder in Africa, because there is no producer for organic milk powder on the whole African continent. Therefore, our milk powder comes from Germany. For all our milk chocolates, we use only organic milk powder from the district of Schwäbisch Hall in Baden-Württemberg. More precisely: from Schrozberg. Since 1975, the Schrozberg dairy cooperative has been farming not only organic, but also 100% Demeter.
Our partner Pure Life has built the first organic raw cane sugar factory in Mozambique, from which we source our raw cane sugar.
If you want to learn more about our partners, you can get to know them better on our interactive map of our suppliers.
Oxfam found in a study that the number of companies transparently disclosing their supply chains has increased in recent years, but still a “clear lack of transparency in supply chains” was identified. The problem with the highly complex, globally interconnected economic system is that while all the information is available, it is not possible to verify in detail at the point of sale what exactly happened during the manufacturing process and within the supply chain. This means it is up to companies to provide more transparency and find new ways to communicate. We at fairafric believe that open communication of value creation is a basic principle for sustainable and social business.