[BLOG] Regaining trust of the supply chain industry through the vendor verification system

For recent years, the supply chain industry has gone through several incidents, now it looks difficult to regain consumer confidence. HACCP was not able to stop food poisoning; the organic logos were not able to prevent the egg contamination in Eastern Europe and parts of Asia. The supply chain industry has been suffering from the discovery of “foreign materials” in the products.

A couple of the renowned cases in Korea, where contamination of the products has been found. The cases of Namyang Dairy Products and Lotte Confectionery can be considered. In the case of Namyang Dairy Products, there was a deceased frog found inside of the baby product; and in October of last year, they have found a fecal matter in another baby product. After the fecal matter incident, before even recovering the brand image, last month, a consumer had found dust particle inside a juice bottle, so the consumers have raged against the distribution company. In the case of Lotte Confectionery, they have found unprocessed iron piece in the ice cream and insects in one of their popular products, which angered consumers as well.

Ironically, the two companies showed a similar position regarding the matters. Lotte Confectionary confessed that the incident didn’t happen during the manufacturing process, and it is difficult for them to manage the distribution and storing process. Similarly, the Namyang Dairy Products told the consumer who found the dust particles that such cases may happen during the distribution process, therefore the incident didn’t happen in the manufacturing process. Stating that the problem did not occur during the manufacturing process. So, how can we avoid such incidents from happening during the distribution and storing process?

On the other hand, small to mid-sized companies, the problem even gets worse. How can they solve the problems that large corporations can’t solve? Let’s think that consumers found foreign materials in the products manufactured by the small to mid-size companies. In most cases, small and mid-sized companies may have to close their business. Also, most of the small to mid-size companies do not have decent supply chain infrastructure that the large companies or corporations have. In the following, it is difficult for companies to identify the problems in the supply chain network. According to the KBIZ Korea Federation of SMEs, an average of 3.5 million small to mid-size businesses exists in Korea. It means that 99.9% of the companies in Korea are small to mid-sized. It also means that so many companies cannot solve the problems that occur during the distribution and storing process and the companies disappear into the thin air.

TEMCO provides a finite solution for such problems that small to mid-size companies are facing. It also provides vendor verification system that verifies manufacturers, distributors, and warehouses. In addition, the possibility of the problems happening in the products during the distribution process is significantly reduced, since TEMCO verifies and confirms the entire supply chain process. Also, consumers can check accurate information of the suppliers and which the supplier and the distributor that their products have gone through. The supply chain data are uploaded into the blockchain in real time, so the consumers can view accurate information in real time as well.

Accordingly, not only the large companies and corporations, SMEs can use TEMCO’s supply chain data solution based on blockchain technology to identify the problems that occur in the supply chain process for the products, transparently. Through this, when problems occur, the companies can identify the exact origin of the problems.

TEMCO solution is under testing, working with current partners as Nenia, Art-Together, 6gram, etc. The SI business that solves problems of the companies is targeting 3.5 million SMEs. TEMCO has progressed from planning to the development stage, to provide a finite solution for the companies who need a hand from being in a situation of shut down because of the problems that occur during the supply chain process.

Within the continuous foreign material in products incidents, TEMCO’s vendor verification system will reduce the worries of the consumers about receiving quality products.

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