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PTI moving ahead, albeit more slowly than expected

by Tim Linden | October 21, 2011

ATLANTA — The industry-wide Produce Traceability Initiative continues to move forward, though very deliberately. At least that is the takeaway message if the opinion of industry members participating in a Produce Marketing Association Fresh Summit convention workshop on the topic was typical.

Ed Treacy, vice president of supply chain efficiency for PMA, set the stage for discussion as the moderator of the event. He reminded the audience that the E. coli outbreak associated with fresh spinach in 2006 was the catalyst for the effort.

“What we had in place in 2006 wasn’t good enough,” he said, adding that a single food-safety problem in a single region had a huge impact on an entire industry because of the inability to trace the problem to its source quickly.

Mr. Treacy said that spinach sales took five years to recover, noting that it was not until recently that sales of the product once again reached the levels seen in mid-2006.

Soon thereafter, the industry launched PTI. Some of the milestones in the voluntary program have come and gone, while others have been delayed, reflecting the difficulty in implementing this program throughout the whole distribution chain.

The PMA executive said that the first five milestones are on the sales side of the equation, with the sixth involving the buying side.

By the end of 2011, all shippers are expected to have a GTIN code on their cases of produce, and those codes are expected to be able to be read as product leaves the shippers’ facilities.

In addition, by the end of this year, retailers are supposed to be able to read and store that information at their distribution centers for all inbound cases. By the end of next year, the retailers also are expected to be able to read and store that information on outbound cases that leave the distribution centers and head to individual stores.

It is clear that while many trials are being conducted, the vast majority of the industry will not meet the milestone at the end of 2011 for all products. The panel of shippers and receivers discussed the efforts of their individual firms and some of the problems companies are encountering and trying to overcome.

Butch Corda, general manager of Ippolito International in Salinas, CA, said that his firm has conducted two trials on six different items using various harvesting schematics, and it will soon be launching a third trial.

On the positive side, the company has found that it can print and generate the GTIN labels in the field on a portable printer.

Solving that part of the puzzle was very important since the company typically has 25 harvest crews in its fields on any given day, with those crews constantly changing fields and packs. Being able to print relatively small batches of labels to reflect the work was an absolute imperative.

“The flexibility in the field helps us control our waste,” he said.

Mr. Corda estimated that the cost of the hardware for the program will be in the range of $80,000 to $125,000, with the cost of printing and applying each label estimated at five cents to nine cents per carton. Wasting labels in the field has to be eliminated to keep the cost per carton at the low end of that spectrum, he said.

As a result of the trials that Ippolito has conducted, Mr. Corda said it appears that his firm can accomplish the task of being PTI-compliant. He added that the firm also has noted that scanning case and pallet tags in the field has given the company some real-time benefits. As those cases and pallets are scanned, the information is uploaded and the sales department has a much earlier handle on the firm’s daily production.

Two retail organizations that participated in the panel — Walmart Stores and Publix Super Markets — concluded that there are hurdles to jump and pitfalls to avoid, but that PTI can be accomplished despite the fact that it will take longer than first anticipated.

Mike Agostini, senior director of produce for Walmart, acknowledged that the nation’s largest retailer is not as far along on the project as it thought it would be at this time. He said that the company initially thought it would be able to accomplish the inbound scanning and storing of information by using data from the advance shipping notices, or ASNs, that the company requires. He said that has not worked as well as expected, and the company continues to tweak how it is going to reconcile the data it collects at the distribution center level.

Mr. Agostini said that Walmart is still working through many different scenarios to determine how it will use the ASNs, case-scanning and voice-pick codes to accomplish the task. His best estimate was that the firm would be able to reach the end of the 2011 milestone by the first quarter of 2012.

Publix was represented by both a computer expert and a warehouse expert, who discussed their firm’s strategy and progress.

Kyle Davis, director of refrigerated warehousing for the Florida-based retailer, said that the company has had to tackle the idea using a systems approach to make sure everyone within the organization is on the same page.

Since the company is switching from a paper-trail system to one utilizing computer technology, it began by surveying its own warehouse workers to determine just how computer literate they were.

Mr. Davis said that the firm was pleasantly surprised to find that 92 percent of the affected employees were at least familiar with computers. Only 8 percent had never interacted with a computer.

The company also surveyed its incoming product to see how much of its product is PTI-compliant. At this early stage, the retailer has discovered that some of the product coming into the firm’s distribution centers was not using the correct GTIN type.

Tony Newberg, distributions systems manager for Publix, explained that there are two different types of barcodes: GS1 128 and the Code 128. While they look similar, only the GS1 works. He said that other problems the firm has found include wrong barcode placement and invalid use of the date function.

Mr. Newberg called these minor problems, but he added that each issue creates hurdles that have to be overcome in the implementation process.

However, the duo from Publix expressed confidence that PTI will work in the long run.

Peter Hill, director of grower relations and food safety for Alpine Fresh Inc. in Miami, also discussed his firm’s PTI trial, stating that the company has found “that it is not as difficult [to implement] as we thought it would be.”

He said that technology is the answer, and the company is moving full steam ahead. “We [as an industry] can’t wait any longer,” he said.

Mr. Corda agreed, although he did wonder why the industry has established a case-specific PTI. “When we have recalls, they are lot-specific, not case-specific. So why not have the traceability be at the lot level?”