Product Traceability

This article is a translation of the German IOTA Beginner’s Guide by Schmucklos.

Product Traceability

Use Cases

Primority: Food Safety – IF

CellWine: Wine Management – Medium

Zebra Technologies: IOTA Track and Trace Ledger API – Homepage

Product Traceability

A very big problem for all companies with their own brand product is the illegal trade with counterfeits. This has considerable negative consequences for all brand manufacturers. In addition to the large losses in sales, there is also considerable damage to the image, because customers take the purchased counterfeit products for originals and attribute the inferior quality (materials, assembly, etc.) to the original brand manufacturer and then lose confidence in this brand.

It is estimated that around 100 million counterfeits are seized across Europe every year. Counterfeit products now account for 5 to 9 percent of global trade, which, according to the OECD, represents a trade volume of $450 billion. Therefore, all major brand manufacturers have been looking for a secure solution to prevent counterfeit products, to improve product identification and to be able to prove the origin of a product to the consumer in a counterfeit-proof manner.

In the past, in order to make the identity of one’s own product apparent to the consumer, additional features (labels, holograms, etc.) were always added to or on the product itself. These unique features had to be clearly visible and difficult to replicate; moreover, these features had to make replicating the product as expensive as possible in order to make counterfeiting itself financially unattractive. Due to technological advances, with the accompanying reduction in the cost of purchasing industrial printers and high-end technological equipment needed to replicate labels, holograms, RFID tags and other elements, this approach has become obsolete. Brand manufacturers no longer want to use expensive solutions for creating additional features that could soon become ineffective.

In addition, from a consumer protection perspective, product traceability is also a fundamental aspect of maintaining product safety. Many drug or food scandals in the past were based on fraudulent adulteration to pretend a higher quality, for example by adding inferior or even prohibited substances. It is precisely in these sectors that considerable health risks repeatedly arise for consumers; there have even been incidents in which cancer patients received a counterfeit drug in which the required active ingredient was not contained at all.


Proof of identity and origin for all types of products is important for companies and consumers alike. All previous systems could be manipulated or counterfeited. In addition, advancing globalization is another challenge, and this global problem cannot be solved sustainably with small-scale nationalism. The IF wants its technology to be the backbone for various digital solutions. All the necessary components are available, open-source and can be researched and used by anyone.

Original source

Last Updated on 16. February 2021