How the $8B Multinational Avery Dennison Leverages Blockchain Across its Supply Chain
At World Economic Forum 2023 in Davos, Switzerland, Blockchain Journal editor-in-chief David Berlind catches up with Avery Dennison market development manager Neil Hay who describes how the $8B multinational enterprise uses blockchain to provide atma.io, a cloud service offering that helps the global giant provide supply chain transparency to some of the largest consumer goods companies in the world (and their customers). A full-text transcript of this interview appears below.
By David BerlindPublished:January 17, 2023
What can blockchain do for supply chains?
David Berlind: Neil Hay, Market Development Manager with Avery Dennison. You're here at World Economic Forum in Davos, Switzerland. You're talking about what Avery Dennison is doing with blockchain technology. Welcome to Blockchain Journal to have this interview. Thanks for coming.
Neil Hay: Thank you.
Berlind: So, Neil, you guys, Avery Dennison is a big company. How big is Avery Dennison?
Hay: Oh, multinational. We're about an $8 billion business, Fortune 500. So, relatively sizable.
Berlind: No small potatoes there.
Berlind: And for a Fortune 500 company, you guys are actually doing some work with blockchain, is that right?
Hay: Absolutely. So we're taking the tracability of supply chains, we're understanding what products, what comprises of that product, and then as it moves through that supply chain, we're giving that immutability, that confidence to the consumer that what I say my product is, it is really made of that. And the impacts it has made, potentially, to the environment through CO2, the ability to decarbonize and have that auditability, that tracability, and that transparency, which is then linked to a blockchain that we can have the confidence to say what we have said is happening has really happened.
Berlind: So your interest in public Distributed Ledger Technology, which is sort of code for blockchain, is in many ways not only the transparency around what you say is in a product, but also, it has to do with how others perceive that product, that a customer has confidence that whatever the manufacturer of that product is saying about the product is true.
Hay: Got it in one. We don't have to search too hard to see examples perhaps of companies that maybe they thought what was happening upstream in their supply chain was true. Maybe the things that they have reported they wholly believed. But the ability to have that auditable tracability piece to then convey the confidence to the customer, you've got it in one, is what the interest in the blockchain is for us.
Berlind: So help me out here. Let's say I buy a pair of sneakers and I'm a customer and I want to know that the leather came from someplace and the rubber came from another place and the shoelaces were made in some sustainable fashion. All that information is somehow collected and put on-chain by Avery Dennison?
Hay: The first point, but I want to go back a step, if I may, and it's that association of the physical item and a digital trigger. So the ability, first of all, to say that, yes, the leather from that tannery is now equal to typically an EPC, so an Electronic Product Code, which sits in the atma.io Connected Product Cloud. So one —
Berlind: I'm sorry, atma.io Connected Product Cloud, is that something that Avery Dennison provides?
Hay: Correct. So maybe I have to go back a step further. Avery Dennison is the business for whom I work. But within that, the business unit atma.io, which is the software as a service, the Connected Product Cloud, which I've just mentioned is where we track and we trace and we capture all of these events as the products moves through the supply chain.
Berlind: So there's the manufacturing stage for a product, which for a lot of products means a lot of things coming together into the final physical item. And then that physical item has to basically be transported hand to hand through different members of some supply chain before it gets to the retailer and then finally ends up in the customer's hand. Is the data that you're putting in this atma.io Connected Cloud, is that available to everybody throughout that chain? Is that the business model here?
Hay: Yes. So, as we collect all of that information in a GS1 compliant language, so I have been made, I have been shipped, I have been received, all of these things, all of these events sit in the Connected Product Cloud. As the sneaker manufacturer, using your example, I have access to all of that information. What we then can do quite uniquely is by giving a consumer-led digital trigger, which is typically NFC or QR, I have the ability then to tap or to scan that trigger, and then based on the story, which I need to tell as my brand, I can convey that information based on the carbon impact, for instance, of this product. And then crucially, what we are doing as a business to decarbonize that piece, that product, or that supply chain.
Berlind: So are you doing this on behalf of other consumer goods companies like sneaker manufacturers or any other consumer good?
Hay: There are a host of companies that use our tracability software, yes.
Berlind: And is this rising in importance to customers? Are customers demanding more of the companies that they buy their products from in the way of sustainability and accountability for the origin of the materials that went into the product? Is that something that's important?
Hay: Personally, I think that we are towards the end of a paradigm shift where the need, the drive for fast fashion and cheap apparel has pretty much ended. And the need now to have products which you have confidence in, which you are proud to wear, and that you know is going to last is here, and that it has a story. And that's one of the key messages that when I'm talking about atma.io is the ability to tell this story in a very auditable way. That confidence that when you put that piece of apparel on your body, on your feet, that you know where it's come from, not just a dye house or a tannery in this country, this dye house in that country. Not that's slightly across the border that have slightly different human rights laws, but the confidence to say, "It's here." We start right from the source, right through, as you said, to the consumer, and then empower that brand owner to tell that story and then we can then have that sat on a blockchain so that there is almost no question as to how that story has built up.
Berlind: And what brands are you working with, or can you say?
Hay: I will not say on the specifics.
Berlind: Can you comment on how big these brands are? Are they really well-known brands?
Hay: I'm happy to say that very large sneaker apparel providers are partners with Avery Dennison.
Berlind: You're an $8 billion company, so you must be working with some big customers.
Hay: With some big customers, yes.
Berlind: Okay. Well, Neil Hay, incredible story there. Thanks very much for telling it, and thanks for meeting with us here at World Economic Forum.
Hay: Pleasure. Thank you.