The recent announcement by Wal-Mart and Sam’s Club Inc. that the stores will begin rejecting produce from suppliers that do not comply with Produce Traceability Initiative guidelines by Jan. 1 has breathed new life into the traceability movement.
PTI was launched in October 2007, with the milestone for supplier compliance to be completed by September 2010. Additional milestones were set for the end of 2012.
Nearly six years after its beginning, PTI is beginning to pick up speed.
In a letter sent May 29, the company described the process it will take to enforce the deadline schedule for PTI compliance at U.S. stores.
The schedule includes a grace period.
Suppliers must begin using PTI-compliant labels by Nov. 1 or their products will be marked as received but “out of spec.”
Effective Jan. 1, produce received at distribution centers without PTI-compliant case labels will be rejected, according to the letter.
No longer waiting
Todd Baggett, chief executive officer of RedLine Solutions Inc., Santa Clara, Calif., says his company’s phones have been ringing constantly by companies ready to implement PTI systems.
“Last year seemed to be the year of waiting because all the early adopters had already adopted and retailers hadn’t yet signaled they were going to require PTI. We needed a big player to step up and implement to keep the ball moving,” he said.
Baggett said that most of the larger companies had already done preliminary investigations and had their PTI plans in order.
“Now is the time to make the investment and implement those plans,” he said.
Not everyone was waiting for an announcement like this, however.
Kevin Brooks, chief marketing officer of FoodLink, Los Gatos, Calif., says he was already seeing increased interest in the program.
“Even before the Wal-Mart announcement a couple of weeks ago, we were seeing an uptick in produce suppliers getting serious about their PTI programs, moving from pilot and test projects to full blown deployments,” Brooks said.
Baggett estimated as little as 15% of the overall market is prepared for the requirements Wal-Mart’s PTI announcement will enforce. However, that 15% may account for up to 50% of the total market volume since some larger companies were already compliant.
The rest of the 85% of produce supply companies will need to make decisions quickly in order to stay caught up.