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Mining in the Democratic Republic of Above: Child workers at a gold mine in
Congo. Legislators in countries such as Burundi. Legislation in several countries
the US demand that company supply now prohibits the use of products derived
chains not include minerals from from child labour. Left: Apple headquarters
‘conflict’ regions in Cupertino, California. The company
recently declared that it audits 100% of its
supply chain to detect ‘conflict’ minerals
Supply chain audits
will grow in scope
to highlight local place names or display But not everyone has a similar more socially responsible citizens.
South African flags on their goods as a incentive to ensure a transparent supply However, any company looking at this
way to entice customers. chain. Many mid-size organisations, for purely from an ROI perspective may want
instance, are often not affected by relevant to have a conversation with Chipotle
However, whether the boerewors (a legislation. For example, the United Mexican Grill, an American fast-food
local sausage) comes from Piet De Jager’s Kingdom’s Modern Slavery Act only chain. The company’s sales dropped
Grabouw farm in the Western Cape or from targets companies with a total turnover 35% in 2015 after an E. coli bacteria
a water buffalo abattoir in Thailand is hard of £36-million (US$45-million) or more. outbreak, not to mention the damage
to determine. Food traceability technology caused to the brand, which was once
has still some way to go in South Africa, However, with increased legislation, an industry darling.
and African consumers have yet to hold consumer advocacy and media attention,
executives to account and scrutinise these the importance of supply chain audits will Tielman Nieuwoudt
audits – if, indeed, they exist at all. continue to grow as supply chains get is Principal of The
longer and more complex. Technology Supply Chain
Some observers also questioned the such as Radio Frequency Identification Lab and has
impact that legislation will have on small- devices (RFID) will play an increased role extensive supply
and medium-sized enterprises (SMEs). in this process. According to Allied Market chain experience
For large multinationals in the spotlight, Research, spending on food traceability covering more
such as Apple, traceability is imperative to technology is expected to surpass the than 30 emerging
their brand strategy and is an achievable US$14-billion dollar mark by 2020. markets in Africa
goal due to the company’s huge resources and Asia. The Supply
(Apple audits 242 smelters and refiners). Beyond social responsibility, questions Chain Lab is a group of supply chain
Small farm-to-fork speciality stores and remain about the return on investment and improvement specialists with a focus on
restaurants also have a major incentive to whether consumers at the mid to lower factory-to-village supply chain solutions.
provide visibility to clients regarding local end of the market are willing to pay for
and ethical product sourcing. increased traceability in order to become
Issue 4 2016 strategicmarketingafrica 51
