Is Supply Chain Visibility Enough?

Previously, supply chain visibility meant knowing where your products were at any given moment. But in 2026, visibility alone is no longer sufficient.

Regulators, customers, and auditors are now asking harder questions:

• Where did this material actually come from?
• What happened to it along the way?
• Can you prove the sustainability claims you are making?
• Is your data accurate, or is it just a well-formatted spreadsheet?

Being able not only to provide product visibility but also to ensure that the product can be verified defines the state of supply chain traceability in 2026. For businesses, this is not a “nice-to-have”, it is a necessity driven by many EU regulations that require sustainability commitments backed by data.

Regulatory Compliance: What is Driving the Change?

According to the regulatory architecture built by the EU, the center of the market access lies with the product-level data. Some of the key instruments shaping traceability right now include:

• ESPR (Ecodesign for Sustainable Products Regulation)(2024/1781) – the horizontal framework establishing DPP obligations across product categories
• EU Battery Regulation (2023/1542) – the first mandatory DPP, with deadlines arriving in February 2027
• EU Toy Safety Regulation (2025/2509) – sector-specific legislation that explicitly includes DPP requirements
• Green Claims Directive – moving toward enforcement in September 2026, prohibiting unsubstantiated environmental claims
• Corporate Sustainability Due Diligence Directive (CSDDD) – requiring companies to identify and demonstrate mitigation of supply chain risks

Although each of the regulations comes with its own specificities, the end goal of all of them is the same: products in the EU must carry verified, machine-readable data about what they are, where they came from, and what happens to them at the end of life.

Moreover, for most of them, the Digital Product Passport plays a big role. It represents a structured digital record linked to a physical product through a QR code, barcode, RFID or NFC tag. The EU’s central DPP registry is scheduled to go live in July 2026, and the first deadlines are approaching.

The Digital Product Passport – Infrastructure for Compliance

At the surface level, one might think of a Digital Product Passport as a label. However, a DPP is only as credible as the data behind it. Therefore, companies need to collect, structure, and verify information from their supply chains. The problem is that, though existent, the data is often scattered across:

• Supplier declarations and certification documents
• ERP and product lifecycle management systems
• Quality control records and audit reports
• Labelling and packaging workflows

The real work lies in turning this data into a coherent, verifiable, machine-readable passport. Hence, adopting traceability platforms that can ingest, organize and share data to and from multiple sources, assign unique identifiers at the product and/or batch level, and generate compliant digital records is crucial.

The standard making this possible at scale is GS1’s EPCIS standard, an interoperability framework that allows different supply chain actors to share event data across systems and organizations. PSQR’s Saga is an EPCIS-based software, providing users with all the necessary features for compliance.

Product Serialization: A Backbone of DPPs

Serialization means assigning a unique identifier to each individual product or batch. Without serialization, a digital product passport has no reliable anchor to the physical world.

Product serialization has been a requirement in industries such as tobacco and pharmaceuticals, and those industries have developed mature, scalable approaches as a result. Now, the time has come for more industries to start serializing their products.

Many sectors already have a batch- or lot-level serialization. However, moving to the item-level will require changes to:

• Labeling processes – unique identifiers need to be generated, printed, and applied at the right point in production
• Production line data capture – events need to be recorded as they happen, not reconstructed afterwards
• Information flow – data needs to travel reliably from manufacturers through to distributors and retailers

What is crucial for companies, both to lower the costs and minimize disruptuions, is to embed serialization into the production workflow as soon as possible.

The Problem of Data Quality

Data collection is a step forward. However, what is needed is to ensure that the data is verifiable and trustworthy.

One of the main challenges of 2026 is bridging the gap between reported data and verifiable data. For instance, sustainability claims made without traceability evidence are being scrutinized both by regulators under the Green Claims Directive, and by buyers performing due diligence.

In a traceability context, good quality data would have the following features:

• Captured at the source, not reconstructed after the fact
• Linked to a specific product, batch, or event, not aggregated at a level that hides variance
• Consistent across supply chain tiers, so that what a supplier reports can be reconciled with what a manfucaturer recieves
• Stored in a way that supports audit, meaning timestamped, immutable, and accessible to authorized parties

For many companies, achieving this level of data transparency requires a more complex software solution where interoperability between suppliers will be possible. Data living in Tier 1 is relatively visibile. Nonetheless, Tier 2 and Tier 3 are where the real data gaps tend to live and where regulators are increasingly looking.

Traceability for Business Advantage

Traceability can bring many benefits to businesses. Companies with mature traceability infrastructure are finding meaningful operational benefits, including:

• Recall management – becomes faster and more precise when you can identify exactly which products are afected by a quality issue, rather than pulling entire production runs
• Supplier performance – becomes easier to manage when you have data rather than declarations.
• Carbon footprint calculations – become more defnsiable when they are groounded in verified supply chain data rather than industry averages.

Moreover, as mentioned before, major retailers and brands operating in the EU are beginning to require DPP readiness from their suppliers as a sourcing qualification. Companies that can demonstrate traceability capability are shortening sales cycles and strengthening existing relationships.

Supply Chain Traceability in 2026 | Expectations

The state of supply chain traceability in 2026 can be summarized as: the infrastructure that used to be optional is becoming mandatory, and the window to build it is narrowing.

The regulatory deadlines are approaching, and the data quality and verifiability are becoming mandatory. The technology to meet these demands, scalable, standards-based, ainteroperable, is already available.

For businesses navigating this landscape, it is crucuial to understand where the current traceability capability sits in comparison with the regulatory obligations and commercial relationships. Once that has been established, the path forward becomes much more manageable.

If you would like to learn how PSQR’s Saga can help you, don’t hesitate to reach out to us.