The Future is in the Cloud

How Labelling Strengthens Global Supply Chains

By Josh Roffman, Senior Vice President of Marketing & Product Management at Loftware

The past few years have proven that supply chain disruption is likely here to stay. Conflicts, regulations, natural disasters, and economic concerns continue to impede the flow of goods and cause product shortages. At the same time, the ongoing boom of e-commerce and the growing demand for supply chain transparency and traceability is applying even more pressure on businesses.

Against this backdrop, business leaders will need to seize any available opportunity to make operations run as smoothly and cost-effectively as possible. The label, though often overlooked, plays a vital role here – think of it as a product’s passport through the supply chain. Supply chains depend on the label to connect a network of warehouses, factories, and distribution centres. As a result, poor label management can result in shipping delays, noncompliance, and costly product recalls. Indeed, according to a 2021 VDC Research survey, eight in ten large enterprises experience at least one major labelling error per year, costing them upwards of $2 million.

As business leaders evaluate business risks, chief among them the likelihood of a global recession, they should place labelling front and center of their plans to manage costs. In today’s increasingly complex global supply chain, labelling operations need to be watertight, complying with both regulatory standards (The GS1 General Specifications, for example) and customer demands. This means businesses must leverage new and innovative technologies to ensure their labels are consistent and accurate.

The trend toward cloud technology

Cloud technology has become increasingly attractive to manufacturers, distributors, and suppliers. Its quick deployment times, low upfront costs, easy access, ability to scale, and seamless updates benefited companies when operations were disrupted by shifts in supply chain models because of the COVID-19 pandemic. It’s no surprise that Gartner has forecast worldwide end-user spending on public cloud services to grow 20.7% to a total of $591.8 billion in 2023, up from $490.3 billion in 2022.

While supply chain disruptions continue to pose challenges, many companies are currently running digital transformation programs that include moving core business applications to the cloud. However, it’s vital that labelling be considered as part of that process too.

Does this approach make a difference?

A cloud-based labelling solution offers a digital ecosystem that allows leaders to meet the full scope of their requirements for bringing products to market quickly, efficiently, and more competitively. It is a strategic enabler of supply chain agility and business operations, ensuring the movement of parts and products – upstream and downstream – without delays or disruptions.

We recently conducted a survey involving 500 labelling, packaging, and supply chain professionals,, and the results were published in the report, “Top 5 Trends in Labeling & Packaging Artwork for 2023.”  We learned 50% of businesses currently deploy business applications in the cloud. A further 71% believe the cloud or a hybrid solution will be their preferred deployment method for labelling over the next three years. The survey also revealed that 44% of businesses view ease of deployment as the most important benefit of cloud labelling.

There are several other benefits of adopting a cloud-first approach. The cloud provides companies with a flexible labelling process that improves scalability, configurability, standardization, and reliability. With the cloud, companies can easily shift production, accommodate a remote workforce, provide device and location independence, and extend labelling to new partners and suppliers. Cloud technology also makes it easier to draw from sources of truth for label data, thereby reducing the risk of costly labelling errors. Additionally, companies can leverage data and configure rules that dynamically change label content, consequently streamlining label updates and approval processes — all while simplifying the route to compliance.

Furthermore, the cloud offers significant cost-saving opportunities, putting world-class enterprise systems into the hands of companies of all sizes, even those that are resource constrained. The cloud also reduces staff costs and overall manpower hours, while addressing expenses involved in scaling and updating hardware and software.

There are several advantages regarding sustainability too, a topic that is front of mind for both consumers and manufacturers alike. Manual and inefficient labelling can negatively impact the sustainability of a supply chain – a failure to get it right results in products being recalled and scrapped. By contrast, dynamic and data-driven cloud-based labelling facilitates a greener supply chain by helping to avoid excessive inventory, as well as reducing mislabelling and the need to relabel products – thereby preventing unnecessary waste. As a result, companies across many industries are turning to the cloud to help reduce their environmental footprint.

An innovation that is here to stay

Forward-thinking businesses are already leveraging the cloud to thrive in the present and prepare for the future. As society continues to face unprecedented economic and environmental challenges, those businesses that are yet to adopt the cloud risk lagging their peers. Among other business-boosting benefits, they will miss out on greater agility, accuracy, and cost savings in the face of ongoing supply chain disruptions.

About the Author

Josh Roffman is the Senior Vice President Marketing and Product Management at Loftware.

He specializes in the impact of supply chain trends on enterprise labelling and directs Loftware’s product strategy. Learn more at www.loftware.com.

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